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IEMR’s Mobile Operator Forecast on India provides over 50 operational and financial metrics for the Indian wireless market and is one of the best forecasts in the industry. We provide five-year forecasts at the operator level going out to 2014. We also provide quarterly historical and forecast data starting in 1Q2003 and ending in 3Q2011. Operators covered for India include: Reliance Communications Ltd. (RCom), Vodafone Essar Limited, Bharti Airtel Limited, Bharat Sanchar Nigam Limited (BSNL), and Idea Cellular Limited. Our Mobile Operator Forecasts are updated quarterly and are available for one-time delivery or through regular updates.

IEMR’s Global Mobile Operator Forecast covers 50 operational metrics of 200+ mobile operators in 50+ countries, making up 80% of the world’s population. Our forecasts are based on our proprietary, country-specific forecasting models. These models deploy multiple regression analysis and cross-impact matrices that estimate relationships between subscriber data, technology use and deployment data, overall economic and demographic changes expected in a particular country; and relate these to company operational and financial metrics.

Executive Summary

Wireless subscriber growth in India continues to be one of the fastest in the world

+49.6% industry-average subscriber growth in 3Q.2009

• The Indian wireless market showed no signs of slowing down in 2008 and 2009 despite the worldwide economic downturn. The operator-wide average subscriber growth (YoY) in 3Q.2009 was 49.6%.

• There still is plenty of subscribers to go around in India as demonstrated by its low wireless penetration rate of 39.2% in 3Q.2009.

• Among the operators covered in our forecast, Idea Cellular continues to have the highest subscriber growth rate at 69.4% (YoY) in 3Q.2009.

• Also, both RCom (Reliance Communications) and Vodafone Essar continue to enjoy subscriber growth rates (YoY) of above 50%.

• BSNL continues to under-perform its peers. Subscriber growth (YoY) at BSNL was 34.0% in 3Q.2009.

ARPU levels continue to fall at an increasing rate

-28.4% industry average ARPU growth in 3Q.2009

• India has seen double-digit ARPU declines for the past three years (since we've tracked this market).

• ARPU declines are being led by the aggressive pricing strategy at RCom. RCom's ARPU growth rate was -40.6% in 3Q.2009 (down from -21.7% in 3Q.2008). Its monthly ARPU has declined to INR 161 in 3Q.2009.

• Also, Bharti Airtel's monthly ARPU declined by -27.2% (YoY) to reach INR 222 in 3Q.2009.

Minutes of Use per Subscriber declined across operators in the latest quarter

-16.1% industry average MOU/Sub growth in 3Q.2009

• The industry average MOU/Sub (Minutes of Use per Subscriber) declined to 377 minutes per month in 3Q.2009, down -16.1% from 3Q.2008.

• Bharti Airtel continues to have the highest network usage among operators with MOU/Sub of 450 minutes per month in 3Q.2009 (down -14.4% from 526 minutes in 3Q.2008).

• RCom's MOU/Sub declined by -19.6% in 3Q.2009 to reach 340 minutes per month.

Strong EBITDA growth at Idea Cellular in the latest quarter

+4.8% industry average EBITDA growth in 3Q.2009

• The industry average EBITDA growth (YoY) in 3Q.2009 was 4.8%, down 15.6% in 3Q.2008.

• EBITDA growth (YoY) at Idea Cellular was strong at 33.4% in 3Q.2009, up from 18.0% in 3Q.2008.

• On the other hand, EBITDA growth at RCom declined from 29.6% in 3Q.2008 to -22.1% in 3Q.2009.

So what is IEMR’s Forecast?

Total wireless subscribers in India to reach 1 billion in 2014

• By combining historical trends with the current market conditions, our forecasting model now predicts that the number of total wireless subscribers in India will reach 1.05 billion in 2014. The Indian mobile operator space is highly competitive with many players.

• We expect that Bharti Airtel will see its subscriber base increase from the current 120 million to approximately 200 million in 2014.

• We also forecast that mobile subscriber accounts at Reliance Communications (RCom) will increase from the current 90 million to about 145 million in 2014.

We expect shift in market share as new entrants gain more subscribers over the next several years

• Bharti Airtel will continue to be the leader in India's wireless market, but we forecast that its subscriber market share will decrease from 23% in 2009 to 18.5% in 2014.

• We also expect that market shares of RCom and Vodafone will decrease to 13.7% and 13.4% respectively by the end of 2014.

• In contrast, we expect that the other smaller operators including Tata Teleservices and Aircel will be taking an increasing share of the market over the forecast period, 2010 - 2014.

ARPU declines to continue over the next five years

• ARPU levels in India will continue to fall across operators over the next several years. Our model predicts that the industry average monthly ARPU will decline from INR 250 in 2009 to INR 203 in 2014.

• We expect that RCom will continue to receive lower ARPUs than its competitors. We forecast that its monthly ARPU will decline from INR 208 in 2009 to INR 160 in 2014.

Bharti Airtel will continue to enjoy higher EBITDA margins than RCom and Idea

• We expect that Bharti Airtel's EBITDA margins will continue to be higher than those of RCom and Idea.

• Our model predicts that EBITDA margins (calculated as EBITDA/reported revenue) at Bharti Airtel, RCom, and Idea will be 43.2%, 36.6%, and 22.3% respectively in 2014.

Companies Covered in this Country Mobile Operator Forecast

Reliance Communications Ltd.

Vodafone Essar Limited 

Bharti Airtel Limited

Bharat Sanchar Nigam Limited (BSNL) (For BSNL, only the subscriber data is available.)

Idea Cellular Limited

Annual Results & Forecasts for each of the above operators is covered in this report for: CY 2001-CY 2014. Quarterly Results & Forecasts are covered for: March 2003 - September 2011

PREPAID AND POSTPAID SUBSCRIBERS                         

SUBSCRIBER GROWTH (YoY)                   

SUBSCRIBERS BY OPERATOR                   

SUBSCRIBER GROWTH BY OPERATOR (YoY)                   

NET SUBSCRIBER ADDS BY OPERATOR

NET SUBSCRIBER ADDS GROWTH BY OPERATOR

MONTHLY CHURN BY OPERATOR

POST-PAID SUBSCRIBERS BY OPERATOR

POST-PAID SUBSCRIBER GROWTH BY OPERATOR (YoY)

PREPAID/WHOLESALE SUBSCRIBERS BY OPERATOR

PREPAID/WHOLESALE SUBSCRIBER GROWTH BY OPERATOR

POST-PAID % OF TOTAL SUBSCRIBERS BY OPERATOR

PREPAID/WHOLESALE % OF TOTAL SUBSCRIBERS BY OPERATOR

POST-PAID NET ADDS BY OPERATOR

POST-PAID ADDS GROWTH BY OPERATOR (YoY)

PREPAID/WHOLESALE NET ADDS BY OPERATOR

PREPAID/WHOLESALE ADDS GROWTH BY OPERATOR

MONTHLY ARPU BY OPERATOR

MONTHLY ARPU GROWTH BY OPERATOR (YoY %)

DATA % OF SERVICE REVENUES BY OPERATOR *

MONTHLY DATA ARPU BY OPERATOR *

DATA ARPU GROWTH BY OPERATOR (YoY) *

MONTHLY VOICE ARPU BY OPERATOR

VOICE ARPU GROWTH BY OPERATOR (YoY)

VOICE REVENUE PER MINUTE BY OPERATOR

VOICE REVENUE PER MINUTE GROWTH BY OPERATOR (YoY)

MOU PER SUBSCRIBER BY OPERATOR (MINUTES/MONTH)

MOU/SUBSCRIBER GROWTH BY OPERATOR (YoY %)

SHARE OF TOTAL SUBSCRIBERS BY OPERATOR

HHI INDEX BY SUBSCRIBER SHARE

SHARE OF NET ADDS BY OPERATOR

SHARE OF POST-PAID NET ADDS BY OPERATOR

SHARE OF PREPAID/WHOLESALE NET ADDS BY OPERATOR

SHARE OF SERVICE REVENUE BY OPERATOR *

HHI INDEX BY SERVICE REVENUE SHARE

YoY CHANGE IN REVENUE SHARE BY OPERATOR *

REPORTED REVENUE BY OPERATOR (REPORTING CURRENCY) *

SERVICE REVENUE BY OPERATOR (REPORTING CURRENCY) *

EBITDA BY OPERATOR (REPORTING CURRENCY) *

CAPEX BY OPERATOR (REPORTING CURRENCY) *

SERVICE REVENUE GROWTH BY OPERATOR (YoY) *

EBITDA GROWTH BY OPERATOR (YoY) *

EBITDA/REPORTED REVENUE BY OPERATOR *

EBITDA/SERVICE REVENUE BY OPERATOR *

EBITDA/INCREMENTAL SERVICE REVENUE BY OPERATOR *

CAPEX/REPORTED REVENUE BY OPERATOR *

CAPEX/SERVICE REVENUE BY OPERATOR *

(EBITDA-CAPEX)/REPORTED REVENUE BY OPERATOR *

EBITDA MARGIN EXPANSION/CONTRACTION BY OPERATOR *

REPORTED REVENUE BY OPERATOR (USD) *

ARPU BY OPERATOR (USD)

DATA ARPU BY OPERATOR (USD) *

VOICE REV/MINUTE BY OPERATOR (USD)

SERVICE REVENUE BY OPERATOR (USD) *

EBITDA BY OPERATOR (USD) *

CAPEX BY OPERATOR (USD) *

* Available only for Reliance Communications (RCom), Bharti Airtel, and Idea Cellular