Only one in five of India’s urban, mobile subscribers will adopt 3G services in the short term, a new study by The Nielsen Company has found.
Despite high awareness of 3G and its capabilities to deliver broadband content, it may be as long as 8-10 years before the majority of mobile users are on a 3G phone plan. Released at Nielsen’s flagship Consumer 360 conference in Delhi today, the study found that nearly 70 percent of urban mobile subscribers are aware of 3G services and 63 percent had familiarity with it as a concept.
The most eager group ready to adopt 3G was power users largely made up of working professionals and internet-savvy youth. They told Nielsen they were eager to embrace higher speeds to access the internet and download large attachments.
A third (36%) of these consumers indicated a strong disposition towards 3G adoption. Other, less tech reliant groups, were less enthusiastic about the next wave of mobile services.
To Drive Mass Adoption, Handset Bundling Will Need to Be Implemented. Even with an enhanced user experience on a 3G network, driving migration to 3G devices will be a challenge.The study found that bundling 3G services with new handsets will be the most effective course of action for telecom carriers.
Thirty five percent of subscribers said they would leave their current carrier if they failed to provide 3G services. In contrast, only six percent of those less inclined to purchase 3G services said they would change carrier if 3G was not made available.
The study also identified an area of particular attention for carriers: reducing pricing to drive 3G adoption may not necessarily grow their businesses. It will come down to the user experience and relevance of services.
“The demand for 3G will dictate the future of smart phones and the competitive landscape amongst service providers. Simply making 3G services affordable will not offer an easy answer to accelerating adoption as we move into an era of more unpredictable handset replacement cycles and the polarization of 3G users within the subscriber base towards operators who offer a better 3G experience” said Arjun Urs, Director – Client Solutions India, The Nielsen Company.
3G’s success in the Indian market will depend on three key strategies, according to The Nielsen Company:
(1) Creating a compelling user experience through services and handset upgrades will be necessary for wider adoption amongst Indian consumers: Over the last half decade the combination of a better user experience and the widespread use of superior handsets bundled with services have led to a seamless migration to 3G in the U.S.
(2) Creating a strong brand association with 3G and demonstrating the relevance of services that 3G can deliver will be the key to consumer acceptance in India. Japan for instance has achieved near universal 3G penetration over the last decade through innovative data plans and highly relevant services for its consumers. In contrast, 3G penetration in China has been sluggish due to the challenges of setting up 3G infrastructure and low consumer education on the facets of 3G.
(3) Merely positioning 3G as ‘faster’ and making it affordable will not drive adoption in India. The Korean market, despite achieving nearly 90 percent 3G penetration with the help of government impetus, has not managed to register high data usage. Data usage has remained restricted to downloads like ringtones, graphics and games. Operators have now begun to create services that are more relevant to consumers to increase revenues from data.
| Intention to Adopt 3G | All | Power User | Imitator | Ambivalent | Uninvolved |
| Will definitely adopt 3G | 19% | 36% | 20% | 10% | 7% |
| Will probably adopt 3G | 43% | 34% | 65% | 31% | 41% |
| May or may not adopt 3G | 25% | 15% | 12% | 31% | 45% |
| Will probably not adopt 3G | 7% | 7% | 1% | 17% | 5% |
| Will definitely not adopt 3G | 5% | 7% | 1% | 13% | 2% |
Table -2
| Intention to Upgrade to 3G Handset | Disposed towards 3G | Not disposed towards 3G |
| Will definitely adopt 3G handset | 63% | 12% |
| Will probably adopt 3G handset | 24% | 24% |
| May or may not adopt 3G handset | 10% | 36% |
| Will probably not adopt 3G handset | 3% | 20% |
| Will definitely not adopt 3G handset | 0% | 8% |
Kush May 7, 2011 at 11:07 pm
THts why i never Belive in surveys like tht.This is a bullcrap written by couple of high paid MBA’s in their office.EVen my 4 year old will tell you tht Indians are very price sensitive…so saying tht lower price will not have any effect is stupid.I think they should go back and read some econmics book. I GIVE A GOLDEN RULE OF THREE 5 …Give a 3G enabled handset for 5 thousand bucks with 5 Mbps speed in 500 RUpees……Wollllaaaah evrybody will have 3G.
But with current 3G rate..i had to rob a bank 9or two to download few movies.
sahil November 25, 2010 at 2:23 am
You both are not clear with the facts. Rs. 67000 crore is the amount which govt of india has got by selling the 3g spectrum combining all the operators if i remember correctly (BSNL-10000cr.+MTNL-8000cr = Rs.18000cr.), Airtel-Rs. 13000cr. Vodafone-11000cr., Aircel-8000cr. Tata Docomo-5800cr. Idea-8000cr. +others.
I cann’t understand why people blame bsnl regarding they didn’t pay equal to others for 3g license & that too without gathering knowledge of the whole auction. One thing is very clear that both MTNL & BSNL has paid the equal value that was of the highest bidder in the circle, which means there are operators in the circle which have pais less than bsnl in some circle.
Instead of criticizing bsnl people must understand that even today the wholesale bandwidth price are nearly Rs.8-10/gb & even after that bsnl is offering unlimited 3g. Even those getting 2mbps speed on 3g are able to download 150-200gb in month which equates 1500-2000rs worth of data in just rs700 leave alone the infrastructure & operation cost.
While on the other side the TATA Docomo is offering 15gb/month for 2000rs = approx Rs. 130/gb, so u can clearly see the margin. U can also see that on broadband why we get 512 kbps unlimited in 750rs. because on average a good downloader will be downloading around 70gb data in a month which means 750rs. have covered the cost of bandwidth used.
So what docomo is doing definitely not fair & we all must thanks BSNL for that they are providing unlimited data & that too at such a low price.
TREMERIN DSOUZA November 24, 2010 at 11:18 pm
@Tushar Gaikwad
dear TUSHAR tata has said that at present video calling is possible only between tata docomo networks they will start other network video calling later.
dskushwaha November 24, 2010 at 11:14 pm
If that is the case, then why is so much hue and cry for 3G. Just to watch video on mobile, download songs etc.on mobile, which I do with my BSNL EVDO’s unlimited connection on my computer?
Tushar Gaikwad November 24, 2010 at 11:04 pm
BSNL 3G is cheaper as well as signal strength and coverage is better.
But, 3G video call from BSNL network to Tata Docomo network (and vice-versa) is not possible…..
I have been trying to figure that out…..BTW I use BSNL to BSNL video calls daily…. (I call up my parents because I am a student who lives in a hostel)…
Can anyone please shed light onto the problem I mentioned.
dskushwaha November 24, 2010 at 10:46 pm
I think you are wrong in saying “BSNL and MTNL payed less for 3G circles while as the private operators payed 65000 crores of rupees”.
They had no option to choose whether to participate or not in the auction, but were made party to an agreement that they would have to match the highest bid amount discovered under the auction for both 3G and BWA.
And Rs. 65000 crores is not paid by any private operator for 3G. Rs. 65000 crores would be the cost of pan-India 3G licence (by adding the licence amount of highest bidder for each circle), which nobody has got even the BSNL (BSNL has no licence in Delhi and Mumbai).
dskushwaha November 24, 2010 at 10:35 pm
Most exiting thing in 3G is video calling not the data. You may get data at comparable speed and rate in EVDO technology. At present most of the 3G phones (even advanced ones e.g. Nokia E5)don’t have video calling function. Manufacture’s newly launched phones priced above Rs.5000 either don’t have 3G or 3G with no front camera. Data cards offered by most of the manufacturers are just 3.6 Mbps ones.
jdjain November 24, 2010 at 9:35 pm
telecom talk must thanks Tata docomo who start 3G in india
Raghu November 24, 2010 at 8:47 pm
no one will use 3g becoz of high data charges. once 3g becomes affordable everyone will start using it.
davidjose November 24, 2010 at 8:45 pm
the private operatore docomo has highest tarriff plan and bsnl plans also not user friendly. that’s the reaosn for low 3g immmigration
Anbu John Boban November 24, 2010 at 7:29 pm
@madhu prasad
you are r8 dude.. u cant wait 15 hours for a 700mb file r8 … with 230 kbps of 2G connection
madhu prasad November 24, 2010 at 7:23 pm
The main Reason behind this is high Data tariff. High speed is a need for bigger file downloads. These are usually more than 60 MB files. some are even around 700 mb files. For lower files like mp3s 2G is quite enough and tariffs are cheap. Why go for 3G when pocket doesnt allows.
Anbu John Boban November 24, 2010 at 7:20 pm
@max
you are r8 dude .. about it.. they are keening on revenue.. all the new routers and other equipments could have burned them. so the customers pocket get looted . so simple
Anbu John Boban November 24, 2010 at 7:16 pm
the 3G is cheaper with bsnl what about docomo ? whether they offer user friendly plans . The 3G license leads the operator to drain the customers pocket . we can see that BSNL and MTNL payed less for 3G circles while as the private operators payed 65000 crores of rupees .
max November 24, 2010 at 7:16 pm
their expectation is only revenu not subscriber
Amit.g November 24, 2010 at 7:01 pm
At the max 5% of urban population will go for 3G as tariff is too high. And yes among 1 in 5 60% of ppl will go for bsnl as we can enjoy cheap 3g tariff. i myself use bsnl 3g for internet. Main problem is in one circle we find 4 players offering 3g services so they cant get ter invested money back in 3years. This burden is managable for Airtel & vodafone but docomo aircel stel idea will face big problem. especially docomo and aircel who have made heavy loss in 2g section itself
MICKY November 24, 2010 at 6:59 pm
GOOD ARTICIL
Nidhi November 24, 2010 at 6:57 pm
Migration to 3G will not necessarily lead to higher non-voice usage. It is important to keep this differentiation in mind as most operators will start reporting high conversion numbers but revenues will fail to catch up. So merely tracking the number of subscribers on 3G will not be enough.
Amit Karmakar November 24, 2010 at 6:55 pm
Absolutely right and worth to think about them.
Manoj Thakur November 24, 2010 at 6:36 pm
In rural areas of India most of people do not know the use of internet in life. So if they don’t know properly about internet, how they can opt for 3G
SOURAV November 24, 2010 at 6:11 pm
I THINK IT WILL MUCH POPULER AFTER 2 YEARS.
TREMERIN DSOUZA November 24, 2010 at 5:39 pm
everyone with 3g handset will migrate to 3g if 3g rates equal 2g or at least within 20%-25% range within 2g rates.