Rock Bottom Call Rates encourage Indians to chuck SMS
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With over 277 million mobile subscribers, India is one of the fastest growing mobile market in the world. It has one of the lowest call rates in the world, even when the market is dominated by prepaid subscribers.
Not surprisingly, a recent report by India’s telecom regulator TRAI, says that Indian mobile users are slowly dumping SMS usage to calling. With calling rates in the country falling like a pack of cards, there has been a steady increase in the talk time usage of the customers. On the other hand, the report says that the SMS usage in the country is seeing a downward slope on the graph.
According to the report, an average GSM user sent about 26 text messages in a month in the quarter ended March 2008, compared to 28 text messages between Oct-Dec 2007. As per the previous stats, average GSM user are 32 text messages during July-Sept 2007, 35 text messages during April-June 2007 and 48 text messages during Oct-Dec 2006. On the other hand, the average number of text messages sent by a CDMA user fell from 24 text messages in Jan-Mar 2007 to 16 text messages per month currently.
However, the fall in the use of text messaging does not worry the Indian telecom operators. According to an executive from a GSM player who spoke to ET:
…any fall in SMS revenues will be more than compensated by increase in the average talk time and revenues.
He further added that:
For instance, while the average number of SMSes have been falling for several consecutive quarters now, the average revenue per user (ARPU) for GSM operators has stabilized and even shown a marginal increase for the first time.
The telecom operators measure the revenue in terms of Average Revenue Per User (ARPU). TRAI’s report tells us that the usage of GSM subscibers per month per customer has increased to 493 minutes, compared to 463 minutes six months back. Interestingly, TRAI reports that the outgoing usage has grown more than the incoming usage.
CDMA operators, however, seem to be lagging here. The ARPU has fallen from 176 in December 2007 to 159 during Jan-March 2008. The average talk time usage too has fallen from 413 in July-Sep 2007 to 364 during Jan-March 2008.
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SMS does not seem to be a good idea unless the person on the other side cannot pick your call. If you are not very clear on a single SMS it will require more SMSs from both sides for clarification that way both the persons together end up paying more to the telephone companies…