India: Mobile Subscribers Increase as Smartphone Market Booms
India’s number of mobile subscribers rose to 940.3mn in May 2017 – a 21.6% increase compared to the same month last year. This is the market’s best performance since 2011 and coincides with the boom in smartphone production in the past year. India is the second biggest market for telecommunication services after China in terms of mobile phone users but its growing pace is far stronger than the Chinese where mobile subscribers grew with 4.2% on average for the period January-May 2017.
The biggest increase in subscribers was registered in the metro areas, where the amount jumped by 25.3%. A and B circles grew close to the average (21-22%) while C circle’s rise was more modest (18.7%). In terms of telecommunication companies’ performance in the Indian market for May, the most significant increase was for BSNL, growing at 16.9%, flowed by Idea (11.8%) and Bharti Airtel (9.5%). Airtel had the biggest client base in May, with 278.6mn subscribers, although the merger of Vodafone (211mn) and Idea (196.2mn) would certainly become the largest once it is completed.
The increase in mobile subscribers in India coincides with the boom in smartphone manufacturing in the country. According to a JP Morgan report, the Indian smartphone market could see a 25-30% growth in the July-September quarter of 2017, or around 7% year-on-year growth. The fast development in the sector indicates that by 2019 around 25% of smartphones globally will be produced in India and almost 96% of mobile phones sold in India will be manufactured locally. The availability of inexpensive smartphones, low rates on data plans, favorable demographics, as well as government efforts to encourage cashless payment (especially after the demonetization of 2016) contribute to the expansion of the Indian mobile phone market.