Indians are consuming data like never before: Details here
Indians are consuming a lot of data at the moment, and trends indicate further increase in the near future. Between 2014 and 2017, average monthly data usage in the country went up by almost 15 times - from 0.26 GB/month at the end of 2014 to 4 GB/month at the end of 2017, driven by falling 4G prices. Here are the details.
The main drivers of increased data consumption
The increase in data consumption, particularly mobile data consumption, has not only been driven by falling 4G prices as a result of Reliance Jio's entry into the market, but also owing to greater availability of quality content on smartphones. With 89% of Indians accessing the internet from their smartphones or tablets, 4G has become the main driver of wireless data consumption, accounting for almost 82% of last year's usage.
How data prices have fallen over the years
Reliance Jio's disruptive entry into the telecom sector in 2016, of course, has to be spoken about in this context. Data prices per GB were hovering around Rs. 229 and Rs. 226 in 2014 and 2015, but fell to Rs. 79 in 2016. By 2017, prices had fallen to Rs. 19 per GB, as other telecom operators were forced into competing at lower prices.
Content availability has increased in unprecedented ways
India has become a boon for online content providers like Netflix, Amazon, YouTube, Gaana, and the like. With increasing amounts of data available at throwaway prices, these providers have started tying up with telecom operators to offer consolidated deals and secure new viewership. Some players, like Netflix and Amazon, have even started commissioning and sourcing content in Hindi and other Indian languages.
Trends in mobile data consumption
Meanwhile, a study by CRISIL Research predicts India's mobile data consumption to grow by four-fold over the next five years through 2022. A doubling of data subscribers to 900 million is also expected in this period, as mobile data subscriber penetration is expected to increase to 80% from below 40% now. Notably, over the past five fiscals, mobile data consumption has grown 24 times.
Older telcos under sustained pressure from Reliance Jio
However, higher usage hasn't meant higher profits for telcos. In fact, average revenue per user had gone down to Rs. 80 in 2017 from Rs. 117 and Rs. 123 in 2014 and 2015, respectively. Airtel reported its first loss in Indian operations in the January-March quarter this year. The pressure on older operators is telling, with Jio aggressively gaining ground and reporting profits.
