According to a report CRISIL, mobile data subscription will cross 900 million users by 2022 in the next five years, with penetration doubling to 80 percent from 40 percent at present.
The faster penetration would be supported by falling tariffs. This would mean telecom service providers would have sweat it out to increase revenue per user to bolster incremental revenues.
The report said, India's mobile data usage per subscriber nearly doubled to around 1.3 GB per month between fiscal 2013- 2017 on faster adoption of 3G and 4G services. Free data offered by Reliance Jio, and a sharp 40 percent fall in tariffs in fiscal 2017 were the growth propellants.
The research pointed India's per subscriber usage at 2.3 GB per user by 2022, or closer to the trend in many evolved data markets, and stabilize thereafter.
Crisil further said WiFi can help reduce costs and increase speeds significantly for a user, adding that rapid expansion in Wi-Fi infrastructure will cause a shift in data traffic to fixed lines after fiscal 2022. India lacks in Wi-Fi hotspots, which is reflected in the time spent on surfing internet over Wi-Fi being a low 18 percent compared with 50 percent in the US.
This puts enormous pressure on mobile networks, which carry the bulk of internet traffic. To be sure, the proportion of data traffic consumed on mobile is high in India, way above 6-7 percent globally. If one even looks at offload data proportion for mobile networks it stands at 60 percent globally indicating most large data markets offload large proportion of data to Wi-Fi (fixed line linked) networks. India needs to catch up significantly with close to 35,000 Wi- Fi hotspots," Crisil said.
Prasad Koparkar, Senior Director, CRISIL Research, "The cost of offering services on Wi-Fi is just a fifth of mobile, and speeds are significantly faster, too. We expect a sharp increase in Wi-Fi hotspots over the next 3-5 years, which can be a drag on mobile data growth once penetration growth plateaus."
Furthermore, Crisil added that videos contribute nearly 80 percent to total data traffic (direct and indirect) in India. The video viewership is dominated by regional languages - nearly 60 percent in Hindi and some 35 percent in other regional languages. Evolution of content in regional languages will play a pivotal role as rural subscribers grow faster.