Huawei launches India Broadband Report 2012


75% connections are in top 30 cities,
Every 10% mobile penetration gets GDP up by 1.2%

Mumbai/ New Delhi: Huawei India, a global leading Information, Communication and Technology (ICT) solutions provider unveiled a comprehensive 108 page detailed report called Connected possibilities; Innovation, Integration and Inclusiveness. In the report prepared in partnership with Ernst & Young, the company pointed out current trends and impact of broadband on 7 key industry sectors namely- Education, Healthcare, Enterprise, BFSI, Governance, M2M and Entertainment. The report also forecasted the future these sectors with the current growth pattern of the broadband industry.

Today, India is touted to be one of the fastest growing economies across with an economy size estimated at US$1.3 trillion in fiscal year FY11 and the telecom services’ sector alone directly contributing US$35-38 billion annually to the economy. In terms, of real GDP at purchasing power parity, India ranks 3rd on the world map after the United States and China and has been maintaining a GDP growth rate of above 6%. The country charted GDP growth of 8.5% [1]for FY11 (financial year ended March 2011). The telecom sector is amongst the leading sectors attracting FDI, accounting for 8.1% of the cumulative FDI equity inflows from FY01 to FY11. From FY08 through FY10, FDI equity inflows in the telecom sector increased rapidly at a CAGR of 42.3% to reach US$2.6 billion, due to the entry of international players and transfer of advanced technologies.

In his address to media, Mr. Cai Liqun, CEO- Huawei India expressed his delight on the unveiling of the report and stated, “One of the biggest innovations in the field of communication is broadband. As a committed player in the Indian ICT industry, Huawei always strives to evaluate needs of the Indian ICT industry and also provide need based solutions. 2012 is a big year for Mobile Broadband with the latest development in this sector- The 4G/ LTE. Today we are here to come together to get a holistic view of telecommunications sector and analyze how the sector is poised for connecting possibilities and the future of broadband in India. I would like to thank Ernst & Young our partners for putting together such an informative report.”

The report not only highlight telecom sector’s which contribution towards GDP, but also how the sector catalyzes development in other sectors to additionally generate economic surplus. Per the evaluation every 10% increase in mobile penetration rate is expected to increase the GDP of the country by 1.2%. The report also highlights an addition of net revenue of USD $ 31 billion (37% growth) and USD $ 27.5 billion (42% growth) in education and healthcare industries respectively and is optimistic that M-commerce would be next revolution in the telecommunication and banking industry providing the consumer with an opportunity to transact anytime and anywhere. It also elicits role of E-Governance in strengthening government processes and their evaluation.

While the report presented a very optimistic picture of the growth of telecom and vis-à-vis broadband in India, it did not overlook the various bottlenecks posed by accessibility and affordability issues in the telecom sector. The report estimated 700 million people in the world without access to broadband services due to cost barriers, lack of awareness and relevant content in the local context especially for rural areas. “More than 60% of current broadband subscribers reside in the top ten metros and tier-I cities and more than 75% connections belong to top 30 cities. Only 5% of the broadband connections are in rural areas in comparison to 31% of total mobile telephones,” said A Sethuraman- Executive Director, Huawei India.

In comparison to other BRICI countries (Brazil, Russia, India, China, and Indonesia), India fares the lowest in terms of internet and PC penetration. Internet users in Indian on an average spend only 0.5 hr online each day, which is lowest rate amongst all the BRICI countries owing to these bottlenecks. “Lack of rural penetration is directly proportional to the lack of awareness, access to affordable technologies and relevant content offered to the subscribers. Most content available today is in English and might not be relevant to the population residing in rural areas where regional content is important. We should thus aim to provide affordable devices and relevant content to ensure optimum connectivity,” Sethuraman added.

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