On this blog I have consistently covered about hurdles in CDMA operators way. Various factors have led to the decline and fall of subscribers and market share. At the end of Dec-2006, CDMA operators had 27.85% market share. 20 Months later [Aug-2008] CDMA operators have 76.5 mn subs[ RCom CDMA has 46,460,140 subs and Tata Indicom has 29,180,06 subs. Other CDMA operators together have ~1,000,000 subs. These Nos include Fixed Wireles Phones.] which translates to 25.5% market share – A drop of 2.35% when the number of mobile subscribers in India have actually doubled. This is also consistent with how Idea Cellular, a late entrant, pipped Tata Tele / Indicom Mobile, a CDMA service provider out of the Top 5.
Going forward, CDMA future looks a little uncertain as they compete against 5 incumbent GSM operators and 4 new GSM entrants. Reliance CDMA will compete with group company Reliance GSM. [Reliance Insiders tell that both the entities will operate as different cost centers] But analysts on Dalal Street are already making the case for Reliance Communications to completely switch to GSM. Another report doing the rounds on the street is, Reliance GSM will be launched under the original Universal Access Service License (UASL) which entitles the company for Sec 80IA benefits of the Indian Income Tax act – 100% exemption of profit for the first five years and 30% in the next five.