India's Mobile Phone Demand to Continue Growing

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India's mobile phone demand is forecast to continue growing next year, despite the global economic slowdown, according to research firm iSuppli.

The proposed rollouts in the country of 3G (third generation) and WiMAX networks, as well as mobile number portability, which allows users to retain their mobile numbers even if they change operators, are expected to fuel growth, iSuppli said.

Auctions of 3G spectrum by the Indian government are now scheduled to be held by January, India's Communications and IT Minister, A. Raja, said earlier this month. They were originally planned to be held last month.

India's mobile phone demand is expected to rise to 136 million units in 2009, up 24 percent from 110 million this year, iSuppli said. This compares to 17 percent growth in 2008.

The mobile handset market in India is forecast by iSuppli to reach 237 million units by 2012, which is a compound annual growth rate (CAGR) of 20 percent.

Data released last month by the Telecom Regulatory Authority of India (TRAI), suggests that India's mobile services market has as yet to feel the impact of the economic slowdown.

Even though consumer demand is slowing down in the country, communications continues to be a priority for consumers, according to some analysts. As a result of the boom, the use of mobile phones cuts across class divides, particularly in urban areas.

India added 10.1 million mobile subscribers in September, taking the total number of subscribers to 315 million according to TRAI. The country added 9.2 million mobile connections in July, and another 9.2 million connections in August.

ISuppli estimates India's total wireless subscriber base will grow at a compound annual growth rate (CAGR) of 25 percent for the period 2007 to 2012 to reach 715 million by the end of 2012. By that time 3G will have a subscriber base of 250 million, while WiMAX will have 19 million subscribers.

Attracted by the strong demand in the Indian market a large number of multinational companies including Telenor and NTT DoCoMo have announced investments in Indian mobile services companies.

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