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The Year That Was!

As we bid adieu to 2018, we take a moment to reflect on how the Indian telecom sector fared over the year.

India stands strong with a mobile base of more than 1.2 billion subscribers, the second largest smartphone market, and one of the countries with highest mobile data usage. The year saw massive improvement in 4G and broadband adoption as the sector added 136 million broadband subscribers. With 270 million Facebook users, 30 million Twitter users, and 225 million monthly YouTube subscribers, Indians are among the highest consumers of social media. The average Indian spends 52 minutes per day watching videos.

The services industry consolidated to three private players, Reliance Jio, Bharti Airtel, and Vodafone Idea, a step forward indeed. Investment totaled Rs 10.44 lakh crore. An indigenous world class telecom infrastructure has been created. More than 300,000 base transceiver stations were added in the last one year, taking the total number to 1.76 million. The sector has abundance of spectrum, post consolidation. National Digital Communications Policy, promising optical fiber links connecting 250,000 gram panchayats by March 2019, steady increase in number of base stations and towers, massive push to increase fiberization of towers, a tremendous thrust to link up homes with fiber, and 5 million wi-fi hotspots to start with, announced in the latter part of the year was the icing on the cake.

No doubt, at the heel of this progress, lurk the headwinds of intense competition and cut-throat pricing among service providers. A debilitating debt of Rs 7.64 lakh crore; falling ARPU from Rs 169 in 1Q FY2017 to Rs 116 in 1Q FY2019; declining AGR from Rs 44,570 crore to Rs 25,580 crore in the same period; higher CapEx to sales ratio at around 30 percent, against the average levels of 15-20 percent in the past; further rupee depreciation given the sizeable foreign-currency denominated debt are no mean challenges.

On the positive note of expected revenue from the telecom equipment sector of USD 26.38 billion by 2020, forecast by market experts, we wish our readers a Very Happy New Year!

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