Net keeps fixed-line ops ticking

The Indian consumer fixed-line services market, which includes voice service, broadband and Internet, is on pace to touch the Rs 24,500- crore mark in 2010, a 5.6 per cent rise from 2009 revenue of Rs 23,200 crore, a report by global consultancy Gartner Inc said.Consumer fixed-line voice revenue is forecast to reach Rs 18,300 crore in 2010, a two per cent decline from 2009. From 2010 through 2014, voice revenue will further decline by eight per cent, the report added." The primary reason for the decline in voice revenue is the decrease in fixed voice lines. Voice traffic has substantially shifted to mobile connections from fixed connections," said Neha Gupta, senior research analyst at Gartner." We will continue to see this trend going forward with consumers abandoning their fixed lines even as service providers are increasingly bundling their broadband and lately IPTV to retain their fixed line customers," she added.The average revenue per user ( ARPU) of voice connections will remain the same due to the limited migration of usagebased minutes to mobile phones from the fixed line phones, which the service providers will be successful in retaining.The Indian consumer fixed line services market will see growth from the broadband and Internet access sectors, which will collectively grow to Rs 6,100 crore in 2010. In 2010, household broadband penetration will cross four per cent. The broadband market continues to be dominated by DSL, which accounted for 87 per cent of all the broadband connections in 2009 and is expected to grow 48 per cent in 2010.Operators have started to focus on rolling- out FTTx/ Ethernet as demand for high- speed broadband and bandwidthheavy Internet applications increase.Wireless broadband services will also grow significantly from 2011, expanding broadband coverage to areas previously not covered by copper telephone lines." Service providers will continue to lower broadband selling prices to attract new users, especially in rural areas. This will put downward pressure on ARPU. Simultaneously, the move towards more expensive, higher- speed access will help push up average selling prices. These two forces will negate each other and we expect the ARPU of broadband connections to increase marginally over the next five years," said Gupta.While broadband will not be widely available outside the major metropolitan areas within the next five years, dial- up accounts will continue to grow in India, albeit at a much lower rate than broadband.In fact, by 2010- end, broadband will overtake dial- up as the primary access technology." Consumers in the services market are slow to adopt new technologies. They are also slow to change their spending habits.This has been especially evident in the past year, where we saw that the Indian consumer fixed services market was resilient during the economic downturn.This slow rate of change in spending habits is benefiting the Indian consumer fixed services market," said Gupta.