India Is Headed Towards The Biggest Digital Data
& Connectivity Opportunity On Earth
The telecommunications market in India, now over 97%
wireless, at 1.127 billion mobile subscribers (Dec -2016), is only 15 years old.
It had a total revenue of $ 33 billion (Rs.2.20 lakh crore)
in 2014-15, and is already amongst the top five employers in the country,
expected to employ 4 million people by 2022. Revenue projections are at $37 billion in 2017
despite falling voice revenue, and increasing data usage.
The Government of India, and lesser adjuncts such as the
semi-government and private sector, are all rapidly going 100% digital for all
critical path activities.
The way of communicating is changing in everything: from
global tendering, ordinary and 3D manufacturing, banking, administration,
media, elections, law, defence, taxation, entertainment, putting satellites in
space etc.
Both hardware and software is now being manufactured and
developed partially in-country. A number
of prominent Chinese manufacturers, the dominant players in the space, of
mobile phones, have set up shop. One or two have also sited their R&D here.
Meanwhile, the digital data appetite on the sub-continent is
growing in Exabytes per month.
By 2021, Ericsson Mobility Report projects 810 million smart
phone users, as prices for the devices keep falling, using over 50 Exabytes per
annum - composed of visual, multi-media data, growing exponentially.
After the November 2016 demonetisation, and the push towards
more digital transactions, Bill Gates, the world’s richest man, quickly hailed India
as the world’s biggest instant digital marketplace.
This was his reaction to just the handling of more of the
money differently, but when you put the entire operation of the 1.2 billion
population country on the cart, it is not only a technological challenge but a
massive business opportunity.
And to meet the exponential growth in demand the big players
are largely in the private sector.
For what once took pen and paper, and later, computers and data storage
equipment, is now processed limitlessly and inexpensively, on the cloud/
internet and accessed on hand-held devices.
The Mobile Telecom market-leader
for 15 years now, Bharti Airtel has just been pushed to second place by the
mega merger of Idea with Vodafone.
This has created a combined entity, still ironing out the
creases, at Rs. 1.55 lakh crores. It is a behemoth bigger than AT&T, and
second only to China Mobile globally.
Idea-Vodafone has a combined revenue market share of 41%, with
Bharti Airtel bringing up the second spot at 36.5% in revenues.
The public welcomed the advent of billionaire Mukesh Ambani’s
Jio Infocomm only a few months ago, (September 2016), with its offer of free
voice and cheap data with a fast 4G service.
That was on the back of a Rs. 250,000 crore green-field investment
from the cash-rich Reliance Group.
Jio Infocomm was created when Reliance Infocomm merged with
Malaysian owned Aircel. With this, it hit
the ground running, instantly becoming the nation’s 4th largest
telecom player.
Ambani saw the potential principally in digital data sales
delivered at a fast speed. Targeting the nationwide mobile telephony population,
Jio Infocomm decided to design and offer “content” in 12 regional languages. It
expects to meet all the dynamic and latent data demand in various Indian languages
by 2018.
Jio’s business model, that has served to disrupt the market
and force realignments amongst the competition, is based on billing for digital
data. This is simultaneous with the consumer surfing on the internet, and speed,
of course is of the essence for it to use more and more comfortably.
But in this, India
lags behind many other countries despite its size and potential both in
erstwhile spectrum allocations and physical infrastructure. But this lacuna will
not stay long now.
Voice, on the other hand, by definition, only clocks revenue
when two people or more have a conversation and is not growing at anywhere like
the same rate.
But universal upgradation to 4G speed, and a much faster 5G
is now on the anvil. New fibre-optic cables are being laid furiously in city
and countryside alike.
Ambani, at the top of India’s list of 101 billionaires, and
33rd on the Forbes global list, at $23.2 billion, is going to spare
no expense or technical resource to capture pole position.
But then neither is Idea-Vodafone,
struggling thus far with its Indian investment for a decade since 2007, when it
bought out Hutchinson’s 67% stake.
Or for that matter, Bharti Airtel, the only non-merged
entity next to the top, hoping to take market share from both Idea-Vodafone and
Jio Infocomm.
This, not just based on competitive plans and tariffs, but
as both iron out connectivity, regulatory, operational, and commercial glitches,
arising from their respective mergers.
As a benefit of both the enhanced investment (over $18
billion in cumulative FDI so far), and the competition between these and other
players, the Indian customer can look forward to better connectivity, service,
pricing, and speed.
Already, special offers and enhanced voice and data deals
are rife.
The government is definitely the biggest single existing and
potential consumer, using mostly its own, wholly-owned, service provider.
Though individuals, and corporations aggregated, are nothing
to sniff at either.
Very soon, the advent
of much faster speeds and data transmission, combined with automation, and the
much greater use of various “apps and bots”
will transform the way India
communicates. On the back of this phenomenon India could well usher in an
efficiency revolution.
Individuals and organisations, long used to bottlenecks and
infrastructure problems, will be empowered. They will learn to access data and
voice at their own pace 24x7, without henceforth being stymied by human error or
lethargy.
For: ABP Live
(924 words)
March 21st, 2017
Gautam Mukherjee
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