The Hindu Business Line : Surging revenues for pvt GSM operators

Riding on an exponential growth in subscribers, private GSM mobile operators have recorded a 49 per cent increase in revenues during the first quarter of the current financial year (April to June 2006) as compared to the first quarter of the previous year. The revenues of private GSM mobile operators have risen to Rs 5,621 crore (Rs 3,760 crore), according to data released by the Cellular Operator's Association of India (COAI).

On a quarter-to-quarter comparison, the operators have recorded a 14 per cent increase in revenues in the first quarter of the current financial year. The adjusted gross revenue has increased from Rs 4,942 crore for quarter ending March 2006 to Rs 5,621 crore for the quarter ending June 2006.

Despite a rise in the adjusted gross revenue, private GSM operators have witnessed a fall in average revenue per user (ARPU) since the September 2005 quarter. The average industry ARPU has fallen from Rs 375 for September 2005 quarter to Rs 347 for June 2006 quarter; a fall of Rs 28 per subscriber since September 2005 (a decline of 7 per cent).

Thus, although the revenues have risen consistently over the four quarters (since September 2005), private GSM service providers have witnessed a continuous decline in ARPU. Mr T.V. Ramachandran, Director General COAI, pointed out that the continuous decline in ARPU is strong evidence of the improving affordability of the GSM mobile service, as a result of which GSM service is achieving increasing growth levels.

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