World 2012

Any guess as to the size of the global mobile telecom services market in
2007? Money operators made the world over? According to Portio Research, during
the 2007, operators worldwide generated more than $800 bn. Compared to this,
India made roughly $16 bn (Rs 76,608 crore) during the 2007-08 financial year. A
tiny contributor today, but the rate of growth of the Indian market will make it
a big players not many years from now.

As far as future projections go, the world mobile services market will be $1
tn by end-2011. And if a projection of approximately 6.4% CAGR is really bang
on, global mobile and mobile related revenues by the end-2012 will touch the
$1,094.9 bn mark. Awesome! And countries of South Asia including India and China
will be playing a big role to make this happen.

Falling voice-based ARPU is a global phenomenon, despite the rapidly growing
subscriber base. So just like India, the world over telecom operators are now
looking at new and innovative revenue streams; and mobile data services is a big
focus area.

The voice-based revenue for mobile operators in India is still higher, if one
compares it with the world average, which is about 81%. And by 2012 the global
voice revenue will come down further to about 74%, and the remaining 26% would
come from mobile data and other value added services. India will have a
challenge going further, as the next phase of mobile growth in India will be in
semi-urban and rural areas, where voice will be everything. Indian operators
will therefore need to think about data services for the more price sensitive
markets.

The Portio report gives very interesting region-wise figures for mobile data
services for 2007. It accounted for about 20% of total service revenue in
Western and Northern Europe; 15% in Central and Eastern Europe; 18% in North
America; 10.5% in Latin America; 7% in Africa; and 11% in the Middle East. And
for Asia Pacific this is 24.5%. India is obviously very low if one goes with the
estimates of about 10-12% here. The need for successful mobile data services in
the face of dropping voice tariffs is therefore very urgent.

Also in 2007, with 49%, SMS was the biggest contributor to non-voice
revenues. But value added services like mobile music, mobile games, mobile
email, mobile instant messaging (IM) and mobile video are gaining popularity,
and could reduce dependence on SMS. Its contribution is expected to come down to
37% by 2012. Clearly, Indian operators have their task well cut out.

Ibrahim Ahmad