After striking partnerships with Youtube,My Space Vodafone completed hectic week on grand note by taking 67% stake in Indian Cellular Service Provider Hutchison Essar. Vodafone never hide their intentions to enter red hot Indian Telecome Industry and they sent signals back in 2005 when they took 10% stake in country's largest cellular service provider Bharti Televentures.Obviously this move will raise the pressure on all domestic players 'coz Vodafone bringing vast Global experience and technology with it.
Let me go through some quick facts.Today,Indian Mobile Phone Industry is one of the fastest growing markets in the world ,thanks to the revised FDI policy and proactive reforms taken in early '90s.Today it is adding more than 5 million new subscribers per month.In India currently more than 150mn Mobile phones are there and tele density have reached almost 10%.Compared to china(More than 430mn Mobile Subscribers) ,it's still less.Nearly 80% of the market controlled by 4 Major players and Bharti leads the pack with 23% market share followed by Reliance(21%),BSNL(17%) and Hutch (17% ).The total Indian Telecom Market worth today is roughly $10bn.In India the total coverage area is devided into 4 metros and 19 Circles and each circle is permitted with maximum of 4 licenses.Indian consumer spends on an avearage $5-$6 per month to power his mobile phone.Indian cellular tariffs are the cheapest in the world.
So,what does Vodafone entry means to Indian consumer?As Urban and Semi Urban market reaching satuaration in terms of handsets ,Vodafone should look seriously into data services and rural penetration,as Rural population represnts 70% of the total population.Already out of 6.5Lac villages in india 5 Lac are connected with telephone but in terms of cellular services penetration ,rural areas lag behind urban with a huge gap.To capture this market all domestic companies already engaged in intense fight by offering handsets with attractive tariffs.So this presents a big challenge to them to meet their target which is to capture 25% market by 2010.Acording to TRAI(Telecom Regulatory Authority of India) India will reach the 250mn subscriber mark by 2010.
Vodafone should explore innovative services like unlimited data services with Pre-Paid data cards which subsequently triggers market for content creators and publishers.From tariffs and quality of services point of view, no doubt that they will improve in the wake of raising competition.In the coming years they should exploit broadband industry in India which is already seeing growing numbers in Urban areas at least.The verdict is consumer is going to be huge beneficiary of all these moves 'coz of raising competition to retain them.