Telecom Lead India: Telecoms service revenue in the Asia-Pacific (APAC) region will grow 29 percent to $323.7 billion by 2016 from $229.7 billion in 2011.
Telecoms retail revenue in the APAC region will grow at a CAGR of 7 percent between 2011 and 2016.
China and India together account for 64 percent of its active mobile SIMs and 75 percent of its retail telecoms revenue. In China, telecoms revenue will grow from $138 billion in 2011 to $194 billion in 2016.
The number of voice connections in the region will increase by 45 percent, to 3.9 billion connections, with most of this growth coming from China and India.
The key trends driving growth in telecoms revenue and the number of connections in the next five years will be 3G and 4G.
3G and 4G services will account for 46 percent of mobile connections in the region by 2016.
The other important growth driver will be the growing demand for Internet access, leading to take-up of smartphones and mobile broadband.
Third catalyst will be improved broadband coverage and connectivity, as a result of greater network coverage and higher international bandwidth.
Analysys Mason predicts that active mobile penetration rates in the region will rise to 95 percent by 2016, a 32 percent increase on 2011 levels. The number of active SIMs will increase from 2.33 billion in 2011 to 3.7 billion by 2016.
“As mobile penetration approaches 100 percent, operators in the emerging APAC region will look to rural areas, and opportunities to provide customers with more than one SIM, in order to maintain growth in subscriber numbers, while developing more sophisticated strategies to drive mobile data revenue and encourage retention within a largely prepaid subscriber base,” said Alexandra Rehak, co-author of the report.
By 2016, 41 percent of active SIMs in the region will be 3G, compared with 11 percent in 2011.
LTE will have limited impact during the forecast period, because of constraints around device availability and affordability, and delays in rolling out LTE relating to spectrum auction timings and operator capex constraints.
By 2016, vendors cannot expect LTE devices to account for more than 5 percent of the active SIM base in the region. Penetration will be slightly higher in China and Malaysia, at 7 percent and 8 percent respectively, slightly lower in India, Indonesia and Thailand (3 percent), and even lower in Bangladesh and Pakistan.
The voice market in the region will continue to be heavily dominated by mobile during the forecast period, with 90 percent of the voice connections being mobile by 2016, up from 84 percent in 2011 and from 73 percent in 2008.
Mobile ARPU in emerging APAC markets has declined significantly in recent years, from a regional average of $10 per month in 2008 to $7.40 in 2011.
The regional decline in mobile ARPU will continue between 2011 and 2016, but at a slower pace than during 2008–2011, because increased spending on non-voice services will somewhat mitigate the effects that have driven the decline to date. Mobile ARPU across emerging APAC markets will average $6.5 by 2016.