India Adds 10.35 mil. Wireless Subscribers in November

According to data released by the Telecom Regulatory Authority of India, a total of 10.18 million telephone connections (wireline and wireless) were added in the country in November compared to 10.29 million connections added in October. The total number of telephone connections reached 374.13 million at the end of November, representing an overall tele-density of 32.34%. The total wireless subscribers (GSM, CDMA, and fixed WLL) base reached 336.08 million at the end of November, a penetration rate of 29.05%. The country added 10.35 million wireless subscribers in November, compared with 10.42 million wireless subscribers added in the previous month. In the wireline segment, the subscriber base decreased by 0.17 million during November to 38.05 million, a penetration rate of 3.3%. The broadband internet subscriber base reached 5.28 million by the end of November as compared to 5.05 million a month earlier.

Outlook and Implications

• Market Position of Existing Operators: The India wireless market continues to add more than 10 million subscribers a month. The country's six largest players—Bharti Airtel, Reliance Communications, Vodafone Essar, BSNL, Idea Cellular, and Tata Teleservices—together controlled about 92.4% of the total wireless subscriber base at end-November. Fuelled by its aggressive expansion into the rural areas, top-ranked Bharti Airtel added 2.72 million wireless subscribers in November, with a market share of 24.7%. The CDMA major Reliance Communications, which is expanding its GSM operations, added 1.77 million subscribers, a market share of 17.7%. Vodafone Essar, controlled by Vodafone Group, added 2.06 million subscribers, a market share of 17.5%. Incumbent BSNL still lagged behind the leading private players in terms of subscriber expansion, adding 700,937 subscribers in November with a market share of 13.5%. Fifth-ranked Idea Cellular added 1.23 million subscribers in the month (a market share of 9.8%), followed by Tata Teleservices' 853,783 subscriber additions (a market share of 9.2%).
• Growth Prospect for 2009: India’s economy will continue to grow in 2008 and 2009, at 6.3% and 5.1% (according to IHS Global Insight forecasts for real GDP growth), albeit at a slower pace than in recent years. Although domestic economic slowdown and consumer spending squeeze will have some negative impact on the telecoms sector, the entrance of new players and 3G/WiMAX licensing will further stimulate competition and therefore drive industry growth in 2009. With 12 operators already offering mobile services in India, competition in the country's mobile market will further heat up with a handful of new licensees due to launch services next year (see India: 13 November 2008: NTT DoCoMo to Acquire 26% Stake in Tata Teleservices for US$2.7 bil., 29 October 2008: Telenor to Acquire 60% of Indian Start-Up Unitech Wireless and 24 September 2008: Etisalat Acquires 45% Stake in Swan Telecom for US$900 mil.). By early 2009, 3G and BWA licences should have been issued in India. This will undoubtedly be a positive step in developing more enhanced infrastructure and services across India in the long term. In the short to medium term however, some areas of uncertainty remain (see India: 23 December 2008: Sparks Fly as India Gears Up for 3G and WiMAX Licensing).