The Hindu Business Line : Dip in minutes of usage per user in GSM, CDMA segments

Number crunch
Minutes of use per GSM subscriber per month declined from 476 in June to 462 in September.
In the CDMA segment also, the minutes of usage per subscriber per month fell to 413 from 462.
Average subscriber outgo per minute has declined from Rs 1.11 in June to Rs. 1.04 in September for the GSM segment.
CDMA subscribers spent Rs 0.71 per minute in September 2007 as against Rs 0.85 in June.

Thomas K. Thomas

New Delhi, Jan. 2 Indian mobile users are now talking less and spending less on mobile phones.

According to a quarterly report for July-September 2007, released by the Telecom Regulatory Authority of India (TRAI), minutes of use per GSM subscriber per month has for the first time declined from 476 minutes in June to 462 minutes in September. Both outgoing and incoming minutes of usage have shown a decrease.

In the CDMA segment also, the minutes of usage per subscriber per month has declined to 413 minutes compared with 462 in June 2007.

Subscribers are also spending less on making calls. The average subscriber outgo (rental+call charges) per minute has declined from Rs 1.11 in June to Rs. 1.04 in September for the GSM segment.

Similar trend has been reported by the CDMA operators whose subscribers spent Rs 0.71 per minute in September 2007 as against Rs 0.85 in June 2007.

The numbers could mean bad news for the operators which are already dealing with falling average revenue per user (ARPU). ARPU per month has further declined by 7.4 per cent from Rs 297 in June to Rs 275 in September inching closer to the Rs 200 mark, below which operations are considered unviable.

Revenues hit

The decrease in key financial numbers therefore has had an impact on the operator’s revenue collection during the quarter.

Compared to a 12.9 per cent growth in revenues in the April-June 2007 quarter, GSM operators have reported a 5 per cent growth in their revenues to Rs 11,903 crore in the second quarter of the current financial year. The growth rate was 8.4 per cent in January-March quarter. GSM operators said that they are not too worried with the falling numbers as it may not be representative of the performance for the entire year. They pointed out that one of the reasons for the decrease in the average minutes per usage and net outgo maybe because of the large number of low-end subscribers getting on to the mobile bandwagon as operators roll out services into semi urban and rural areas.

Market watchers, however said that users may be talking less as operators have not offered any significant tariff cuts in 2007. They also said that telecom companies could be under pressure as they undertake huge capital expenditure to roll out network to more areas.

More Stories on : Telecommunications | Regulatory Bodies & Rulings

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page