Analysis of Inter-Regional Mobile Services Growth in India

Quick deployment, competition, advancement in technologies, and reduced prices have propelled the growth of mobile services in India much like in other developing and transition countries. Since India has the third largest mobile subscriber base in the world, it is important to study the factors that affect the growth of mobile telecom services in the country. It is the objective of this study to determine the effect of different techno-economic variables on the growth of mobile services in India. The demographic, economic and market variables vary widely across regions of developing country such as India. Though a number of cross-country studies exist, this is one of first attempts to study the inter-regional growth of mobile services across service areas of a country with an evolving telecom market. We model the growth of mobile services using technology diffusion framework, incorporating other variables that impact growth. Our analysis of panel data using the model indicates that competition and network effects arc the factors that drive growth of mobile services in India. The traditional factors such as income, population and fixed line penetration do not have any significant impact on the growth of mobile subscription.