Telecom industry's revenue grew 6.5 per cent last year, the lowest since 2010, despite the sector witnessing a further addition of 79 million active subscribers during the period, says GSM industry body COAI.
"If I go back to 2010, the industry has consistently been delivering double digit growth of about 10 per cent. After years of constant revenue growth of double digit, it has come to the level of 6.5 per cent," industry body COAI's outgoing chairman and Idea Cellular Managing Director Himanshu Kapania said at an event.
He said the industry has seen decline in revenue from voice calls, although overall subscriber base rose by 79 million last year.
"Industry has been investing in expansion of network and at the same time cut down data tariff by 20 per cent and voice call rates by 10 per cent," Kapania said.
He said that telecom regulator Trai reducing interconnection charges from 20 paise per minute to 14 paise per minute, decline in roaming rates and reduction in SMS rates has led to steep decline of an estimated 8-10 per cent.
"Despite volume expansion in minutes and growth in subscriber base, the overall mobile voice segment revenue recorded negative to zero growth for the first time in the history of Indian mobility sector," Kapania said.
At the event, COAI announced new leadership team. Bharti Airtel MD and CEO for India and South Asia Gopal Vittal was elected Chairman, taking over from Kapania.
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Kapania said that last year was a pivotal year of
investments in the mobile broadband networks with a host of new 3G and 4G network launches.
"After launching 1,75,000 sites last year, the entry of a new operator and expansion by incumbents will result in the industry adding another 3-3.5 lakh mobile sites," he said.
However, consumer uptake has been weak, he said.
"The low price elasticity for mobile data services resulted in the segment revenue growth slowing down from its earlier triple digit levels in the past years to about 40 per cent," Kapania said.
Vittal said that cost of doing business is only escalating whether it is spectrum, laying out optical fibre, taxes or levies imposed on the sector.
Telecom secretary J S Deepak said that there are challenges in the industry and also dissatisfaction among people on use of services.
"There has been lot of dissatisfaction in mobile broadband experience. India is at 91th position among 130 countries when it comes to broadband experience which we need to address. There are hurdles and we have to handle it in multi-pronged way. There is huge opportunity," Deepak said.
Trai Chairman R S Sharma said that industry is in a transition phase and a dip in industry happens when gears are shifted.
