India’s Mobile Market

Telecom Asia has some interesting comments by Sunil Miital of Bharti (Airtel):

India will not only be a major contributor to GSMs next billion subscribers, but can also serve as a model for similar growth in other emerging markets.

That was the message from Bharti Telecom chief Sunil Mittal at the 3GSM World Congress in Cannes on Wednesday, saying that the key to growth in emerging markets like India was increasing affordability of mobile services.

Even today we are still trying to reduce the sachet size of our tariffs, he said in a keynote address. We are already offering services for $5 a month. Could we do $3 a month? Possibly. Our tariffs now are around 2 cents per minute, and we think we can still go lower.

Mittal also praised the GSM Associations initiative with Motorola to develop a sub-$40 handset that Motorola says will be priced under $30 by the middle of next year. I dream that we will see a $25 to $30 handset in the next few years, he said. At that price, we can give them the volume so they can lower the capex for us.

According to Mittal, India is still bursting with untapped potential, citing over 11 million households that can afford mobile service. As prices drop, that should increase to over 32 million in 2009, by which time by current growth rates India will become the third largest mobile market in the world after China and the US.

Mittal invited other emerging markets to come to India and study its mobile model. It works. We have demonstrated clearly you dont need to charge 25 to 30 cents a minute to make a profit, he said. With this model, India, China, Brazil, Russia and Africa will easily bring the next billion users in the next few years.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.