With unfolding competition in the mobile data market, 4G connections are likely to account for 17 percent of the total user base by 2020 with revenues in the range of Rs 79,580 crore, an Assocham-KPMG report said on Wednesday.
According to the report, the entire business mix of the telecom industry is going to witness a sea change and the introduction of 4G on large scale by one of the largest corporate houses is going to be a major development.
"4G is expected to significantly transform the revenue mix of service providers with estimated Long Term Evolution (LTE) revenues expected to reach Rs 79,580 crore in the next few years," a statement said.
The report said the demand for high speed internet services would receive a further push from key governmental initiatives such as 'Digital India' and 'Smart Cities'. Besides mobile networks have been identified as key tools for financial inclusion where 4G can facilitate implementation of government's social sector schemes in a faster and secure way.
The report further said handset manufacturers are up to with the growing market of current and future 4G users.
It said the telecom sector in India is at an inflexion point, where it is poised not only to ride a high growth trajectory but also to provide a strong impetus to the government's key development initiatives.
However, the report also sounded a word of caution. "While demand growth is expected to remain steady on the back of affordable smart phones, digital inclusion programs and 4G rollouts, high capital requirements and an extremely competitive scenario continue to affect the profitability of key players," the report said.