Despite Large Customer Base, Rural India Poses Challenge To Mobile Operators

November 2, 2009 8:17 a.m. EST

New Delhi, India (AHN) - Despite socio-economic development and an expanding customer base, mobile operators in rural India are finding it difficult to maintain their networks effectively. A recent report, entitled, "Mobile Strategies for Rural India," indicated that operators should adopt a more comprehensive strategy to serve such areas.

The report was released last Thursday, by Ovum, a global analyst and consulting company.

Amit Gupta, author of the report and principal analyst of Ovum, India said, "Due to huge population base, low teledensity and strong socio-economic developments, rural India is becoming an important growth frontier for the mobile industry."

Gupta added, "Despite a huge rural population and low teledensity, the addressable market in the short to medium term is less than 200 million unique subscribers out of a total population of more than 800 million."

According to the report, owing to the average revenue per user (ARPU), limited electrification and insufficient road connectivity, "deploying and operation a wireless network in rural areas is expensive."

The report adds that these challenges can be overcome if operators reduce their focus on increasing ARPU and concentrate more on innovation and excellence in operations.

The report also suggests partnerships with the government and non-telecoms companies to charge them, rather than the poor end customers, for providing mobile services."