Jio, Airtel will gain from global data usage increase over decade

The transition of digital ecosystem to metaverse, will increase global data usage by 20 times by 2032 and telecom companies such as Bharti Airtel and Reliance Jio are poised for “suitable benefits” from this surge, as per a Credit Suisse report released on February 17

”Internet traffic is already 80 per cent video and has been growing at a 30 per cent CAGR (compound annual growth rate). Our team projects that even modest metaverse usage could drive a further 37 per cent CAGR in the next decade to 20x current data usage,” the report said.

Metaverse enables individuals to immerse in a virtual world through augmented reality and virtual reality. AR and VR are also expected to boom and metaverse has “enormous potential to further expand screen time and drive more bandwidth consumption”, the report added.

According to the report, while 5G will support the metaverse ecosystem, the emergence of 6G will enhance metaverse use cases.

It said the gaming segment is one of the segments where early use cases of metaverse are expected.

The report mentioned that gaming is at an early stage in India and mobile gaming is being driven by mobile phones due to the emergence of affordable smartphones and 4G data services.

”Mobile internet remains the key medium for Indian users to go online, given relatively low fixed broadband penetration. The share of mobile gaming in online games is expected to increase in future,” the report said.

The report added that India is one of the leading countries in the world in terms of number of hours spent on mobile per day but it has low penetration of fixed broadband compared to global peers, which will be key to realise the full potential of metaverse.

”While it is too early to determine the impact of metaverse on Indian telcos’ revenues, we believe Bharti Airtel (with 17 per cent of revenues from fixed line) and Jio are well placed to benefit from surge in data usage driven by metaverse in the latter half of this decade,” the report said.

The report says fixed broadband penetration in India will increase to nine percent in the current fiscal from 6.8 percent in FY20, and rise to 12.6 percent by FY25 driven by continued demand for data and telcos’ push to improve use of their fibre infrastructure.

”We expect the penetration to increase further to 12.6 per cent by FY25E driven by continued demand for data and telcos’ push to improve utilisation rate of their fibre infrastructure,” the report said.

CT Bureau