15 August 2011

India Telecoms- Device prices coming down sharply—could boost 3G uptake ::Credit Suisse,

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India Telecoms Sector-----------------------------------------------------------------------------------------
Device prices coming down sharply—could boost 3G uptake


● We visited a Reliance retail outlet in Mumbai to get our hands on
the new 3G Tab. The device is available at retail price of
Rs12,999 ($290) without any data plans. But connectivity is
possible only on RCOM networks using RCOM SIM cards.
● The company is offering 40–50% discounts on data tariffs for 12
months if customer prefers to take up a data plan along with the
tablet. Beyond 12 months, the prevailing normal data rates apply.
Indian telcos thus continue to stay away from upfront cash
subsidies on devices.
● The configuration could be sufficient for basic usage, with 4GB
memory card, accessories such as headphones and USB
connectors. We found decent user experience across general
applications and browsing (claimed download speed of up to 7.1
Mbps). Youtube videos came through with no buffering delay.
● The price is significantly lower than the tablets in the market. High
device prices is one of the barriers that had to be surpassed
before mass uptake of 3G/data services in India—this seems to
be going away. We would look out for updates on the other
barriers, namely lack of locally relevant native language content.
We remain positive on the 3G prospects for Indian telecoms.

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