Here’s the reason for the slow uptake of 4G LTE in India

It is a fairly well known and well-accepted in the industry that the uptake of 4G services, launched by various service providers, like Idea Cellular, Bharti Airtel and Vodafone India, is not impressive. While it is still early days to pass the verdict one way or the other, it is certainly likely to be an area of concern for Reliance Jio which is close to launching commercial 4G network soon. The low uptake will definitely be giving sleepless nights to the senior management of the company. Mukesh Ambani-led Reliance Jio has already invested more than Rs 75,000 crore in setting up the state-of-the-art network.

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Mobile broadband is growing for most of the telcos but the same cannot be said about 3G and 4G networks. There is a dichotomy here. There is not an iota of doubt that there is a strong demand for mobile network but then why is it that 4G and 3G before that are not able to catch the fancy of Indian telcos.

There are various reasons for the low uptake of 4G. A key and possibly the most important reason is that 3G never really took off. No, no it is not as confusing as it sounds. In the consumer perception, they want to wait and watch before going for that 4G device and SIM. Remember not too long back, they were promised high speeds and better quality of mobile broadband, when 3G was launched. Instead what they got was inflated bills.

This time around they don’t want to take a chance till 4G network has stabilised the telcos have put all the nuts and bolts in place. Couple this with never ending call drops that customers are not wrong in taking every claim of service providers with a pinch of salt. Further a consumer thinks in terms of bills. In his/her mind, more the speed, more the consumption leading to high bill. Thus the reluctance to adopt 4G services.

The second issue is the device problem. There is still a huge confusion regarding the device. A consumer is not sure whether he should go for 4G device or VoLTE device and whether 4G device can be used for VoLTE and vice versa. There is little doubt that this hampering the growth of 4G ecosystem.

These factors are impacting all the telcos but it is to be said that the effect would be most on Reliance Jio, which is putting all its eggs in the 4G basket. If the uptake is low, the return on investment is going to take a very long time for them. The incumbents still have 2G and 3G networks, but that is not true for RJio.

Also read: Vodafone 4G vs Jio 4G

However, at the same time, the enterprise segment might be the saviour of both, the incumbents and Reliance Jio. The service providers are targeting the enterprise segment aggressively and this is one segment which goes for the latest technology. This time it is all the more relevant because of the advent of new technological concepts like Internet of Things and Machine-to-machine. The enterprise space is growing with small and medium enterprises also moving towards cloud adoption. The contribution of this segment will grow significantly for the Indian service providers and will be the focus of both incumbents and RJio.

The end-consumer adoption of 4G services is still some time away. The telcos would do well to focus on network upgradation so they can truly offer what they promise.

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31 Comments on "Here’s the reason for the slow uptake of 4G LTE in India"

 

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Linto
February 19, 2016 1:43 am 1:43 AM

But idea has launched 4g service in most of the cities in Kerala even rural ares too, I think they are getting a good response. Idea already have 99% 3g coverage in Kerala

amit
February 18, 2016 4:16 pm 4:16 PM
Two biggest problems 1. There is huge rural-urban devide. 3g and 4g are present in metro cities only. Remember more than 70% of population that rural India is still left with only 2g. 2. Everyone is talking about 4g speeds but volume of data is more important. 40 gb data at 4 mbps speed is better than 4gb data at 40 mbps. 1 GB 4g data at rs 250 is a joke. It will be depleted with in hour. So if reliance jio provides 10 gb at 500 and 25gb-30gb in rs 1000 and both rural and urban India than… Read more »
prasad mayya
February 19, 2016 9:00 am 9:00 AM

+1

Colorado
February 18, 2016 3:29 pm 3:29 PM

Indian operators do everything possible to increase prices of broadband access. Then when the usage drops, they blame it on “lack of adoption” & “lack of device ecosystem”. If you want something to be popular, it HAS to be cost effective. This is true worldwide. Actually we Indians are very unlucky. The biggest private operators in India are only there for making profits. They do nothing to contribute to the improvement of the nation’s broadband.

Ashish
February 27, 2016 11:44 pm 11:44 PM

You are absolutely correct dude. In last 2 years, reliance have launched various 3g data plans, but as soon as a plan becomes popular, they cut down the data. In case of Idea, their data plans are not for normal users.

Yash Shekhawat
February 18, 2016 10:19 pm 10:19 PM

How r they supposed to recover the hinge investments they have made in spectrum purchase. They r not NGOs remember. If u want service l u better pay up

Colorado
February 19, 2016 10:53 am 10:53 AM

Have you seen the financial performance of the leading telcos? Revenue growth is in full swing. Not a single parameter signifies that they are in loss or not recovering the investments they have made. Also keep in mind, that India is a price-sensitive, volume driven market. There are countless cases of profitable companies which recover their investments because their prices are low. So more people are encouraged to buy from them & this leads to their profit.

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