NEW DELHI, India-The cellular subscriber base in India will explode during the next few years, but the average revenue per user (ARPU) will register a steep fall, an independent study has warned.
The total cellular subscribers are projected to increase from 5.47 million in 2001 to 42 million by 2006 and 76 million by 2010, indicating a compounded average growth rate of 50 percent through 2006 and 33 percent by 2010, according to a study by the Federation of Indian Chambers of Commerce and Industry (FICCI) and KPMG.
But the average-both prepaid and postpaid-ARPU is likely to come down to 375 rupees (US$7.76) by 2005 and 313 rupees (US$6.48) by 2010 and average minutes of use (MOU) will come down to 152 minutes in 2005 to 117 minutes in 2010. The main reason for this is an increasing percentage of prepaid users in the total subscriber base and comparatively lower duration of use.
The declining trend in the ARPU and MOU will impact the margins of the operators, said the study, released at the start of a two-day telecom summit in Bangalore on Thursday.
