The global analyst firm Analysys Mason has prepared a report for GSMA in which it has highlighted the direct and indirect economic impacts of developing wireless broadband in India. One of the key findings of the report is that increase of 1% in wireless broadband penetration will contribute 0.11% (INR 162 bn) to Indian GDP in 2015. This includes the direct impact as well as indirect impact in the form of benefits to the ecosystem as well as productivity and efficiency gains among the corporate employees.
According to the Report, increased penetration of wireless broadband will have a significant impact on wireless broadband ecosystem that include different industry sectors like Consumer and Retail, Financial services, social services such as education and healthcare, and other corporate vertical sectors. The estimated revenue impact of Mobile Broadband on each sector by 2015 is as follows:
• Consumer / Retail (m-Advertising, m-Entertainment, m-Commerce)
82% increase in Mobile Broadband enabled revenue to INR 187 billion
• Financial Services (m-Banking)
67% increase in Mobile Broadband enabled revenue to INR 205 billion
• Social Services (m-Learning, m-Health, m-Government)
101% increase in Mobile Broadband enabled revenue to INR 63 billion
• Corporate / Verticals (m-Farming, m-Enterprise, m-Utilities)
60% increase in Mobile Broadband enabled revenue to INR 60 billion
The development of wireless broadband will also have significant impacts on the Government’s national broadband plan target of 100 million connections by 2014.
The report however, also indicates that the lack of spectrum will be a formidable constraint in realizing the Mobile broadband potential. According to the results from a high level analysis ( based on projected demand per user), operators will not be able to serve more than 80 million subscribers without carrying out significant additional investments in sites. Hence, In order to succeed, Mobile Broadband technology must be allocated with further spectrum. Analysys Mason estimates that allocating an extra 5 MHz of 3G spectrum per licensee could increase Mobile Broadband penetration by more than 35%, resulting in almost 160 million 3G users by 2015. This would also increase national broadband penetration by 3.3%, resulting in an additional INR 538 billion to India’s GDP by 2015. By this time, Mobile Broadband could contribute a total of INR 2,190 billion to the Indian economy.
The study has also emphasized the need to create an ICT ecosystem to realize the significant and wide-reaching productivity gains. While the benefits of improved wireless broadband access are known, this report goes a step ahead by presenting those benefits in a quantitative manner. The report like many other indicates that in a country with large rural population such as ours, development of wireless broadband ecosystem is a key step towards meeting the Government’s objectives of Inclusive growth.
Our Take on this..
As we’ve highlighted in the past(here and here), there are a number of entrepreneurs ready and willing to solve problems in India rather than cater to western clients. Mobile broadband access is a very vital part of India’s master plan to achieve inclusive growth. Like Nigera which has time and again taken the lead in mobile banking, India too has the opportunity to pioneer effective ways to use mobile broadband not even fathomable in other parts of the world. This has always been asserted, now we’re beginning to see some solid financial prediction as well. Hopefully this mobile broadband penetration will spur the revolution forward.
What do you think? Let us know!
