India 3G Report: Analysis of Services Rollout and Key Players Strategies

A GrowthPraxis Report on evolving 3G services ecosystem in India. Written by Jayanth Kolla, Amit Goel, Arun Raveendran and Shalabh Dhankar. April 2011 Release. For enquiries please contact: india3greport@growthpraxis.com
Or call +91-80-41231576

Report Overview

GrowthPraxis research report titled “India 3G: Analysis of Services Rollout and Key Players Strategies” includes  in-depth analysis of 3G services in various developed & developing countries with systemic differences with respect to India, Analysis of spectrum bidding strategies of private Indian carriers, 3G rollout scenario in India including Capex allocation, Network rollout and Potential subscriber additions by carrier, Key challenges for services rollout in India, Analysis and future growth projections for various 3G services in India Impact analysis & Opportunity assessment for over 30 players across the telecom value chain and Recommendations to players for structured positioning aiming sustainable growth in the evolving 3G landscape in India.

Executive Summary

3G services have been launched by all the carriers (except STel) in India with multiple services and various sachet & usage-based tariff plans, with varying uptake. Globally, 3G services have been available for a long time (almost ten years in Japan). Carriers in various international markets have adopted different strategies while launching 3G services. While carriers in developed markets primarily focused on enterprise customers, carriers in developing markets (launching 3G relatively later) targeted retail consumers and offered the high speed wireless technology as a potential broadband option to the consumers.

Indian carriers (especially incumbent carriers) currently face multiple structural challenges such as congested networks and limited available spectrum (5MHz) to offer 3G enabled data optimized services at launch. Also, carriers’ “walled garden” approach to value added services and prevalent piracy and Indian consumers’ lack of willingness to pay for such services pose a huge challenge for immediate uptake of 3G services. However, once the 3G device prices decrease and the tariffs stabilize in the first two years, GrowthPraxis believes that the 3G uptake will rise in 2013 and reach over 90 million by March 2014.

Among the various 3G enabled services launched by the carriers, mobile internet services are expected to garner maximum revenues (of over US $4.5 billion) with over 80% of 3G subscribers adopting these services by March 2015. Although, currently location based services are in nascent stage, GrowthPraxis believes that various services such as mobile gaming and mobile surveillance will increasingly use 3G enabled location based services in future. Of the various mobile video-based services, video calls are expected to witness significant uptake and 3G enabled music streaming service is expected to grow, driven by increase in the number of 3G subscribers and decrease in content costs. As per GrowthPraxis estimates,  while the incremental ARPU (monthly) for 3G subscribers is expected to be approximately US $3.7 (INR 166), the incremental blended ARPU (monthly) driven by 3G services is expected to be over US $0.45 (INR 20) by March 2015.

3G launch in India is also expected to create multiple opportunities for various players across the telecom value chain and each player is working on a specific ‘India 3G’ strategy. While technology and chipset player Qualcomm is focusing on consolidating its leadership position, Mediatek is developing feature rich multimedia phone solution (MT6268) for high end 3G phones and banking on leveraging its strong relationship with Indian mobile handset companies . Among carriers, while incumbent players (such as Airtel & Vodafone) are focusing on voice-centric deployment of 3G services initially and offering data enabled services only opportunistically in order to retain high end customers, new pan-India players (such as Aircel) are focusing on offering data enabled 3G service at launch. Dual technology players (Reliance Communications and Tata Teleservices) intend to leverage both their EvDO and HSPA networks to offer high speed data services to its subscribers.

Of the various mobile handset companies, currently market leader Nokia has 3G devices across various price points and also enjoys a strong brand equity and wide distribution network in India. However, Samsung and Micromax can potentially leverage their quick time-to-markets; strong feature phones play and brand association with the target audience to emerge as strong players in the 3G devices space. HTC and Blackberry are expected to do well as niche players. Among VAS companies, niche technology platform enablers such as Apalya (video services platform provider), and content providers/aggregators such as MapmyIndia (maps and navigation content provider), Indiagames (gaming content provider), etc are expected to witness significant growth.

As various industry players plan and execute their strategies targeting consumers in the emerging 3G ecosystem in India, GrowthPraxis believes that players who are able to partner and create a win-win solution for other value chain players (integrating their operations & business models) to offer a single touch-point and end-to-end value to the consumers will evolve strongly in the Indian 3G ecosystem.

The “India 3G: Analysis of Services Rollout and Key Players’ Strategies” Report is available for purchase at GrowthPraxis at an introductory price of USD 3000 only. The TOC is giving below:

Table of Contents

1. Overview of Global 3G Markets

i.              Analysis of 3G services uptake in various developed & developing markets

2. Overview of Current 3G Scenario in India

i.              Overview of 3G spectrum licences for various carriers

ii.             Analysis of 3G spectrum bidding strategies of private carriers

iii.            Analysis of current 3G services and tariffs of different carriers

3. Challenges for 3G Growth in India

i.              Structural Challenges

ii.             Supply Side Challenges

iii.            Demand Side Challenges

4. Projections of 3G Subscribers, Revenues and Devices

i.              3G subscribers and devices projections model

ii.             Forecasts for 3G subscribers growth

iii.            Forecasts for 3G ARPU growth

iv.            Forecasts for 3G devices growth

5. 3G Services and Applications for Consumer Uptake in India

i.              Overview of 3G enabled services in India

ii.             Growth of location based services driven by 3G – Subscribers & Revenue forecasts

iii.            Growth of mobile internet services driven by 3G – Subscribers & Revenue forecasts

iv.            Growth of music streaming services driven by 3G – Subscribers & Revenue forecasts

v.             Growth of video-based services driven by 3G – Subscribers & Revenue forecasts

vi.            Growth of mobile gaming services driven by 3G – Subscribers & Revenue forecasts

vii.           Potential for 3G enabled mobile surveillance services in India

viii.          Adoption of various 3G services by different consumer segments

6. Impact of 3G in India and Growth Opportunities for Key Industry Players

i.              Overview of the existing telecom value chain in India

ii.             Analysis of 3G strategies of key technology and chipset companies

a)    Qualcomm

b)    Mediatek

iii.              Analysis of 3G strategies of key network infrastructure providers

a)    Nokia Siemens Networks

b)    Ericsson

c)    Huawei

d)    ZTE

e)    Indian Telecom Equipment Manufacturers

iv.              Analysis of 3G strategies of key private carriers

a)    Airtel

b)    Vodafone

c)    Idea Cellular

d)    Tata Docomo

e)    Aircel

f)    Reliance Communications

v.              Analysis of 3G strategies of key mobile device OEMs

a)    Nokia

b)    Samsung

c)    Micromax

d)    HTC

e)    RIM (Blackberry)

vi.              Analysis of 3G strategies of key VAS companies

a)    Phoneytunes

b)    Mauj

c)    Hungama

d)    IMI Mobile

e)    Indiagames

f)     Tanla Solutions

g)    Indiatimes

h)    One97

i)     Comviva

j)     Spice Digital (Cellebrum)

k)    MapmyIndia

l)     Apalya

m)   OnMobile

7. Recommended Model for Sustainable Growth in the Emerging Indian Ecosystem

i.              Global case study – Analysis of Apple model

ii.             India case study – Analysis of Nokia Life Tools

iii.            Potential model for Integrated Solution Provider in India (GrowthPraxis Recommendation)

List of Charts

1. Current 3G subscribers status

i.           Number of 3G Subscribers in Various International Markets (mn)

ii.           3G Subscribers as a Percentage of Total Subscribers Base in Different International Markets (2010)

iii.          3G spectrum auction winners and circles

iv.          3G Spectrum Winners-2G Market Share Leaders Mapping (as of Jun ‘15)

v.           Subscribers per MHz for Leading GSM Carriers in Metro Circles

vi.          Subscribers per MHz for Leading GSM Carriers in Category A Circles

vii.         No. of 3G subscribers for each operator (Mar-Apr ’11, figures)

2. Forecast for Subscribers, Revenues and Devices Growth

i.          India 3G Subscriber Projections (mn, FY ‘12 to FY ’17)

ii.         Incremental Monthly ARPU of 3G subscribers (US $, FY ‘12 to FY ’17)

iii.        Incremental Monthly Blended ARPU Driven by 3G Services (US $, FY ‘12 to FY ’17)

iv.        3G Handsets Sales Projections in India (mn, 2012 to 2017)

v.         No. of 3G Enabled LBS Users by Type of Service (FY ‘12 to FY ’17)

vi.        No. of 3G Based Mobile Internet Users(FY ‘12 to FY ’17)

vii.       No. of 3G Based Music Streaming Users(FY ‘12 to FY ’17)

viii.      No. of 3G Based Video Services Users by Type of Service (FY ‘12 to FY ’17)

ix.        No. of 3G Based Mobile Gaming Users by Type of Gaming (FY ‘12 to FY ’17)

x.         3G Subscribers Projections for Airtel(FY ‘12 to FY ’17)

xi.        3G Subscribers Projections for Vodafone(FY ‘12 to FY ’17)

xii.       3G Subscribers Projections for Idea(FY ‘12 to FY ’17)

xiii.      3G Subscribers Projections for Tata Docomo(FY ‘12 to FY ’17)

xiv.      3G Subscribers Projections for Aircel(FY ‘12 to FY ’17)

xv.       3G Subscribers Projections for RCOM(FY ‘12 to FY ’17)

3. Revenue Growth Forecasts

i.         3G Enabled LBS Revenues by Type of Service (USD mn, FY ‘13 to FY ’15)

ii.        3G Based Mobile Internet Revenues (USD mn, FY ‘13 to FY ’15)

iii.       3G Based Music Streaming Revenues (USD mn, FY ‘13 to FY ’15)

iv.       3G Based Video Services Revenues by Type of Service (USD mn, FY ‘13 to FY ’15)

v.        3G Based Mobile Gaming Revenues by Type of Gaming (USD mn, FY ‘13 to FY ’15)

 

4. Market Share

i.     Nokia’s Market Share by Volume (Q1 ‘14 to Q1 ‘15)

ii.    Samsung’s Market Share by Volume (Q1 ‘14 to Q1 ‘15)

iii.   Micromax’s Market Share by Volume (Q1 ‘14 to Q1 ‘15)

 

5. Carrier Capex Investments & Projected number of BTS

i.          Airtel’s Estimated 3G Capex Investment & No. of BTSs (FY ‘13 to FY ‘15)

ii.         Vodafone’s Estimated 3G Capex Investment & No. of BTSs (FY ‘13 to FY ‘15)

iii.        Idea’s Estimated 3G Capex Investment & No. of BTSs (FY ‘13 to FY ‘15)

iv.        Tata Docomo’s Estimated 3G Capex Investment & No. of BTSs (FY ‘13 to FY ‘15)

v.         Aircel’s Estimated 3G Capex Investment & No. of BTSs (FY ‘13 to FY ‘15)

vi.        RCOM’s Estimated 3G Capex Investment & No. of BTSs (FY ‘13 to FY ‘15)

 

6. Sales Figures

i.          HTC’s Quarterly Sales by Volume(Q1 ‘14 to Q1 ‘15)

ii.         RIM Quarterly Sales by Volume(Q1 ‘14 to Q1 ‘15)

 

7. Shipments

i.          Qualcomm Chipset Based Devices Shipments in India & China (2013-15)

ii.         Mediatek Annual Chipset Shipments (2013-15)

 

8. 3G circles contracts by network vendors

i.          NSN’s 3G Contract Circles by Carrier

ii.         Split of Total 3G Contract Circles of NSN by Category

iii.        Ericsson’s 3G Contract Circles by Carrier

iv.        Split of Total 3G Contract Circles of Ericsson by Category

v.         Huawei’s 3G Contract Circles by Carrier

vi.        Split of Total 3G Contract Circles of Huawei by Category

vii.       ZTE’s 3G Contract Circles by Carrier

viii.      Split of Total 3G Contract Circles of ZTE by Category

 

9. 3G Devices – Share in Current Portfolio and Split by ASP

i.         Share of 3G & Non-3G Devices in the Current Portfolio of Nokia

ii.        Split of 3G Devices by Price Point for Nokia

iii.       Share of 3G & Non-3G Devices in the Current Portfolio of Samsung

iv.       Split of 3G Devices by Price Point for Samsung

v.        Share of 3G & Non-3G Devices in the Current Portfolio of Micromax

vi.       Split of 3G Devices by Price Point for Micromax

vii.      Share of 3G & Non-3G Devices in the Current Portfolio of HTC

viii.     Split of 3G Devices by Price Point for HTC

ix.      Share of 3G & Non-3G Devices in the Current Portfolio of RIM

x.       Split of 3G Devices by Price Point for RIM

 

10. Others Statistics

i.         Voice and Data Capacity for 2G Site

ii.        Voice and Data Capacity for 3G Site

iii.       VAS Revenue Breakup for a leading GSM Carrier, 2015

iv.       CRBT Subscription Economics for Carriers (INR)

v.        Online Music Sales in India

vi.       Total No. of Active Credit Card Users in India (mn)

vii.      Multimedia Content Piracy Levels in India

viii.     AT&T Wireless Subs Growth Post iPhone launch

ix.      iTunes App Store Application Downloads

x.       Total No. of iPhones Sold and No. of Apps Downloaded (2013-2015)