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Usage has increased not only because fast 4G data is now very cheap, but due to sources of content for smartphones having multiplied. Most online videos are seen on smartphones, and a study by media analytics company Comscore shows 89% of Indians go online on phones and tablets — the highest share among large data-consumption economies. 4G, which promises speeds of at least 10Mbps, is the main driver of wireless data consumption, accounting for nearly 82% of total usage last year.
4G data prices have fallen from an average of Rs 269 per GB in 2014 to Rs 19 now — and even lower in case of bundled individual data packs. It’s 7% of what customers paid earlier.
Prices dropped sharply after Reliance Jio, which has a 4G-only business model, launched in September 2016. However, with rising internet usage, rival companies like Airtel, Vodafone, Idea Cellular and BSNL have also expanded their 4G network.
Increasing wireless data consumption has been a boon for streaming services like YouTube, Gaana and Hotstar. Some, such as Netflix and Amazon Prime, have even started commissioning and sourcing content in Hindi and other Indian languages.
Sales of “smart” or internet-ready TVs are also up. Rahul Tayal, a director at LG India, said smart TVs make up 40% of their TV sales now. Many TVs now come with apps such as Netflix, YouTube and Hotstar and consumers mirror-cast from their smartphones.
Not only data but also voice calls have increased after a dip. To keep up with Jio’s offering of free calls, competing operators have come up with their own schemes, effectively reducing voice prices to nil in case of bundled data offers.
Higher usage has not meant higher revenues and profitability for the companies. The average revenue per user (ARPU) — a key measure of a telecom company’s health — has been for GSM players from Rs 117 at the end of 2014 to around Rs 80 at the end of 2017.
The pressure is telling on older telecom players even as Jio remains aggressive and reports profits. Airtel, the country’s biggest mobile operator, has seen a decline in profitability since Jio’s launch and suffered its first loss (in Indian operations) during the January-March period this year.