Tekelec MD for India Rajesh Kaul sees huge opportunities in the explosive Indian market as it leverages its existing signaling deployments into new number portability business
Billing & OSS Supplement: India's telecom market has completely transformed over the past three years. With a strong customer base in India, what do you see as operators' key challenges?
Rajesh Kaul: In the short term, Indian operators face two main issues: rapidly scaling to meet demand, and number portability. India's wireless growth is unique, and service providers must create the infrastructure to support hundreds of millions of new subscribers each year. Also, number portability has a year-end deadline, and is the world's largest number portability deployment.
Long term, Indian operators have the same challenge as other global operators: complexity from the evolution of network technology. New devices, protocols and services enter the network faster than legacy ones leave, meaning that operators must support an ever-widening range of technologies to meet subscribers' expectations. The complementary challenge is that operators want to maximize the value of existing equipment, while simultaneously transitioning to next-generation networks like LTE.
While experiencing hyper-growth, what is your outlook for voice and SMS in India over the next few years? How soon until they become commoditized like in so many other markets?
Voice ARPU is quickly declining in India, turning operators more to SMS as a revenue-generating service. Operators here are finding that, as in other markets, the younger generations are driving adoption and wider use.
SMS will not be a commodity for at least a few more years due to several factors. The first is subscriber growth. As with other markets, subscribers in India typically don't begin with "bucket" plans that erode profits and lower ARPU. In fact, the average Indian sends 29 SMS per month, according to the Telecom Regulatory Authority of India (TRAI).
Vital Analytics released a report in July saying that almost 5% of service provider revenue comes from SMS value-added services, making them the highest revenue earning VAS. We expect this to be a highly profitable VAS for several years.