The cellular and wireless in local loop (WLL) telecom equipment market to date is worth some $1 billion market. The Illinois-based Motorola is estimated to have a 50 per cent market share (in volume terms) and some 25-30 per cent in value terms. With the initial spate of equipment order drying up and the cellular market slowing down, US and European telecom majors are now eyeing the expansion market and trying to open up new markets like WLL services.
Anders Gustafsson, general manager, South Asia cellular infrastructure (CI) division, Motorola, who was until recently heading the $30 billion major's India CI business tells Josey Puliyenthuruthel what he thinks of the future of the Indian cellular and WLL market:
Q: The Indian cellular market has witnessed more than 100 per cent growth in the last two years. What does the future hold for it especially when juxtaposed with the rest of South Asia?
A: This year is going to be slower in India across the board (cellular and WLL services) than what we had expected this time last year. Basically, people are waiting for the government to come up with the concessions (for cellular operators). Until then, the operators will not have sufficient funding to run their operations, the banks won't come in.
But, looking at from the infrastructure perspective, the last four years have been very active (in telecom). First, there were the (cellular equipment orders) in the metros in 1995, then the large circles the next year and 1997 was the first batch of contracts for basic telecom. Now, 1998 has not seen much (activity).
Q: Having said that, how much exactly do you expect the Indian market to grow annually?
A: For cellular subscribers, we expect the market to double year on year for the next several years _ 100 per cent growth. This year (1998) there is going to be a very modest growth with India having some million subscribers. If the health of industry improves, this should grow to two million in the next year.
Q: Do you see the same growth figures for the rest of South Asia?
A: The growth may not be so high because the base is higher. Even so, this year, there is a fair amount of new subscribers coming on board this year although there is a higher churn rate.
Q: When do you see CDMA (code division multiple access)-based WLL market really taking off in India?
A: It should start growing fairly rapidly towards the end of the year. When more and more (private basic) operators come on line, the numbers should grow.
Q: At an all inclusive cost of $600-800 per subscriber, WLL networks are far cheaper than wireline networks. What is the market share for WLL equipment then going to be?
A: The WLL market should be 20 per cent of the total market. For the private basic telecom operators the share is going to be much more, while for DoT it is a should be less.
