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India Wire Indians talk on mobiles, Chinese telcos rake in the money
India Wire Indians talk on mobiles, Chinese telcos rake in the money | Indians talk on mobiles, Chinese telcos rake in the money |
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| Written by Sufia Tippu | |
| Tuesday, 21 November 2006 | |
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According to 2005-06 statistics, the Chinese service providers’ ROCE was 22.87% while that of an Indian operator was a mere 7.42%. This is despite the fact that India’s capital employed per subscriber is lower at $147 than China’s $152. The Chinese operators enjoy a higher ROCE because they spend much less on a subscriber every month. Their operating expenditure per month is $4.73/month per subscriber compared to $5.49 in India. China is also lot more labor efficient. The operators employ about 600,000 executives to manage a mobile subscriber base of 450 million while Indian operators employ around 400,000 against a base of 136 million subscribers. When it comes to the capital employed by operators for expansion and upgrading in ’06 China is way ahead in planning. Its projected investments stand at $23 billion in ’06, while Indian operators’ commitments during the same period are only $6 billion. Although India has been adding 5-6 million mobile subscribers a month, this growth is limited to the mobile market. Fixed line growth has been almost flat at less than 2%. While this is not the case with the Chinese fixed line growth which has been growing double digits. Incidentally, China has 360 million fixed line connections compared to 47 million in India. Besides, fixed line connections are available in 97% of villages in China against 89% in India. As for broadband penetration, China has nearly 10 times more users than India and continues to add seven times more subscribers on a monthly basis. But, despite China scoring high on all financial parameters, it is the Indian subscriber that enjoys the lowest tariff in the world. Although the average minutes of usage per month in India is 393 and 470 for GSM and CDMA respectively, compared to China’s 300 (GSM) and 277 (CDMA), the average monthly mobile bill per subscriber in India is nearly 50% lower than his/her counterpart in China because of the low tariffs. {moscomment}
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