economictimes.com
Thursday Jul 06 2000
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Cellular market to witness 25% growth: IDC
NEW DELHI
The cellular handset market in India is expected to witness a 25 per cent growth in units terms to 4.92 lakh units in 2000 from 3.94 lakh units sold in the previous year.
The handset market is all set to increase by 27 per cent in value terms at Rs 541.8 crore by end 2000 against Rs 426.3 crore in 1999, according to a latest IDC survey.
Overall the cellular subscriber base in the country is expected to increase to 24.5 lakh in 2000 from 15.9 lakh in 1999, it said.
Without giving the individual market shares of various players, it said Nokia, Motorola and Siemens emerged as the top three players in 1999, constituting about 70 per cent of the market in the white channel.
"Introduction of value added services like short messaging service have been quite profitable for the cellular service operators," it said.
On the future market drivers, it said introduction of caller party pays regime and other services like internet access from handsets through wireless application
protocol would drive the growth in the cellular industry in the coming year.
"Majority of cellular operators today are at the entry level stage where the most frequent use of cellphone is for voice communication. Generally, entry-level handsets offering a good combination of features have sold well in the market.
The IDC study further said reduced airtime and falling handset prices were two major reasons behind the spurt in demand for cellular handsets in the country.
"Net reduction in the handset prices this year is about 10-15 per cent only which could have been higher, had the increase in sales tax not offset the reduction in customs duty," it said.
While analysing the distribution channels in the Indian market, the study said the cellular operator and vendor's own distribtuion network were the two main methods of handset distribution.
"However with the recent changes in the telecom policy wherein the handset sales by the cellular operator form a part of his revenue and he has to pay a share of this revenue as operating licence fee - the operator's interest in selling handsets has gone down," it said.
Another trend that emerged was that the market players were laying greater emphasis on retail, it said adding that handset vendors were going in for exclusive shops and also setting up separate retail counters in other shops for offering point of presence, merchandising, and training support. - PTI |
