Mobile Broadband in Sweet Spot – Ecosystem Favors Growth

Mobile Broadband in IndiaNokia’s latest report on the state of Mobile Broadband in India suggests that the Indian data market continues to be in a sweet spot backed by – high-end 2G data users are migrating to 3G, 3G/4G device penetration is accelerating on the back of decreasing handset prices, video, audio and social networking are driving traffic and average usage on 3G in India is reaching global benchmarks.

Indian Consumers get Taste of 3G High Speed Networks
3G data traffic growth in Metros stood at 56% in CY2015 while 2G traffic declined 12%; 2G traffic growth continued to be positive for other circle categories even as it slowed down to a modest 6% in category A circles. These figures indicate a higher extent of 2G-to-3G migration in metros and A circles, on expected lines. On a pan-India basis, data traffic grew by 50% yoy in CY2015 with 3G traffic growing at 85% and 2G at 12%.

Video, Audio and Social key drivers of growth
Close to 60% of all mobile data traffic is in the form of audio, video and social networking. Entertainment content including movies, TV and music videos is the main driver (about 90%) of video traffic, with about 90% of this traffic being short-format (one to three minutes in length); this is where India continues to be different from most markets with longer-duration streaming still seeing slow adoption. On the social networking front, user engagements by the likes of Facebook and news consumption. Another major traffic driver is communication (instant messaging) services, where traffic is mainly driven by photo and video sharing.

3G / 4G Mobile Handset Ecosystem in Place
Nokia’s study notes that entry-level 3G handset prices have declined to US$40 currently from US$50 a year ago. As a result, pan-India 3G device penetration increased to more than 30% at the end of 2015 from about 15% in 2014; moreover, almost one in every two metro users has a 3G-enabled phone, with Mumbai leading the pack at 58%. Entry-level 4G handset prices have declined to US$70 from US$140 a year ago. As a result, adoption of 4G devices is increasing at a rapid pace. In fact, 4G device penetration in Metros and Circle A stood at 10% and 6% respectively at the end of 2015. Another interesting point to note is the fact that a majority of these devices have in-built support for 1800 Mhz and 2300 Mhz bands; about half of these devices also support the 800 Mhz band.

Increasing availability of high-speed networks, improving network speeds driving better consumer experience,
increasing affordability of devices and increasing proliferation of content are steadily helping increase the average usage per Indian user. Other key excerpts of Nokia’s Mobile Broadband Report is as summarized here.

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