Revenues from fixed broadband services to rise 7.8% annually: IDC

Fueled by cloud and video, the fixed broadband services are likely to see a growth of 7.8 percent annually for the next five years, according to research firm IDC.

"The difference between broadband subscriber number and revenue growth shows continuous average revenue per user (ARPU) decline in India. One reason is the high price pressure and fierce competition in India telecom market," IDC said in its semi-annual Telecom Services Tracker report.

IDC expects India's fixed broadband market to reach $2.12 bn by 2017 at 7.8 percent that is less than an expected yearly subscriber growth of 13.9%.

It revealed that rising preference for broadband on mobile devices is the reason behind slow uptake of fixed services.

"Sustaining revenue growth and profitability will be challenging" as over the top players (OTTPs), or apps, are eating into operators' revenue streams through services like voice, at a time when the telcos are spending top dollars to upgrade their network to meet market demand. This has forced operators to change their business models.Some have partnered with OTTPs to enrich the portfolio and to drive innovation," said Sherrie Huang, Research Manager of IDC's Asia/Pacific Telecommunications Group.

Driven by growing bandwidth demand and the government-driven broadband projects, the broadband market in Asia Pacific (excluding Japan) is expected to grow at 12.1% annually for the next five years.