Mobile data usage to touch 2.5 GB per user by 2022: Report

Mobile data usage to touch 2.5 GB per user by 2022: Report

NEW DELHI: Mobile datausage is expected to grow a moderate 12% annually and touch 2-2.5 GB per user in the five fiscals through 2022, and stabilise thereafter, Crisil Research said. Between fiscals 2012 and 2017, India’s mobile data usage per subscriber rocketed at 80% annually to around 1.25 GB per month on increasing adoption of 3G and 4G services, free data offered by Reliance Jio, and a sharp 40% fall in tariffs in the past fiscal alone.

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Given the operators’ quest for market leadership, the decline in mobile data prices could continue in the medium term as well, but at a slower pace. While not immediately but over the long run, data usage growth on mobile could stabilize for the operators, as Wi-Fi gains ground. “A comparison of trends across countries indicates higher data usage is strongly linked to higher speeds, whereas India’s current mobile data speeds on 4G are less than half that of say South Korea,” Crisil said.

The agency added that the advent of infrastructure linked to Wi-Fi can reduce costs and increase speeds significantly for a user, even as investments continue to gradually improve mobile network quality. It said that rapid expansion in Wi-Fi infrastructure will cause a shift in data traffic to fixed lines after
fiscal 2022, bringing “the Great Indian Mobile Data Story under a cloud.”

Crisil said that service levels of Indian mobile networks are not at par with international standards, coupled with poor Wi-Fi infrastructure. It said that India lacks in Wi-Fi hotspots, which is reflected in the time spent on surfing internet over Wi-Fi being a low 18% compared with 50% in the US.

“This puts enormous pressure on mobile networks, which carry the bulk of internet traffic. To be sure, the proportion of data traffic consumed on mobile is high in India, way above 6-7% globally. If one even looks at offload data proportion for mobile networks it stands at 60% globally indicating most large data markets offload large proportion of data to Wi-Fi (fixed line linked) networks. India needs to catch up significantly with close to 35,000 Wi- Fi hotspots,” Crisil added.

Mobile data subscriber penetration will reach 80% by 2022 from less than 40% now, which means telcos will have to increasingly sweat per-subscriber usage to bolster incremental revenues thereafter. Crisil also expects doubling of data subscribers to more than 900 million.

Videos contributes nearly 80% to total data traffic (direct and indirect) in India, according to telcos’ data reviewed by Crisil. The trend here is similar to China, where videos contribute 77%, though in some evolved markets such as South Korea, online gaming is also a large contributor.

Further, the video viewership is dominated by regional languages – nearly 60% in Hindi and some 35% in other regional languages. Evolution of content in regional languages will play a pivotal role as rural subscribers grow faster.

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Time spent by Indians is already in line with evolved markets. On average, Indian users are on their mobiles for 3 hours, bulk of it on social media and messaging apps. The usage is already in line with adult US mobile users who spend 3 hours and 20 minutes on non-voice mobile services. However, surveys indicate that US mobile users spend less than 30 minutes on social networking sites and 30 minutes on videos.

“Given that both time spent and content are around global levels, the quality of services would be critical to a rise in data usage going forward. However, a number of other factors can also deter mobile data usage from growing in line with past trends,” Crisil said.