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India’s fixed communication services revenue is projected to increase at a compound annual growth rate (CAGR) of 2.9%, reaching USD 13.2 billion by 2028. This growth can be attributed to the significant expansion of the fixed broadband segment across the country.

Factors Influencing Expansion

This expansion is underpinned by multiple factors including the increasing penetration of the internet, driven by initiatives like Digital India and the proliferation of smartphones. As a result, there's a growing demand for high-speed and reliable broadband services, particularly for activities such as online education, entertainment streaming, and remote work, both in urban centers and rural areas.

Telecom operators, notably Reliance Jio, are heavily investing in expanding their fixed broadband infrastructure, particularly through the deployment of fiber optic networks. This infrastructure development aims to meet the escalating demand for high-speed internet services and offer more stable connections to consumers and businesses alike. Additionally, competitive pricing strategies and bundled service offerings, combining broadband with other amenities like television and voice services, are further driving market penetration and subscriber acquisition in the fixed broadband segment.

Moreover, supportive government initiatives, such as the BharatNet project, are accelerating broadband connectivity efforts, particularly in rural areas. This project aims to provide high-speed internet access to underserved communities, contributing significantly to the expansion of fixed broadband services nationwide.

Sectoral Increases and Decreases

According to the India Fixed Communications Forecast (Q4 2023), the revenue from fixed voice services will decline at a 4% CAGR from 2023 to 2028. However, the fixed broadband industry is likely to experience a significant increase.

Srikanth Vaidya, a Telecom Analyst at GlobalData explained that the decrease in income from fixed phone services is consistent with the declining average revenue per subscriber (ARPU) levels due to the growing adoption of mobile and over-the-top (OTT) communication services, and operators offering free voice minutes with their fixed bundled plans.

“Fixed broadband services revenue, on the other hand, will increase at a CAGR of 3.5% during 2023-2028, driven by the growth in broadband subscriptions, especially fiber broadband, and higher broadband ARPU levels,” said Vaidya.

Furthermore, fiber optic service revenue is projected to grow at a 4% CAGR through 2028, with fiber optics accounting for 80% of the total broadband lines in the country. This is also supported by the government’s investment in the development of fiber network infrastructure and the growth of fiber-to-the-home (FTTH) services by operators.

During the forecast period, Reliance Jio is anticipated to lead the fixed broadband services market in terms of subscription share. This dominance is attributed to its robust presence in the expanding fiber broadband service sector and persistent efforts to bolster its FTTH network. Reliance Jio's promotional offers on broadband plans can also strengthen its market position.

“Rising demand for high-speed internet services and competitively priced fiber broadband plans from operators with benefits like unlimited internet and access to major SVoD platforms are expected to drive fiber broadband service adoption in India during the forecast period,” noted Vaidya.

Overall, the convergence of these factors is expected to fuel substantial growth in India's fixed communication services revenue over the forecast period, positioning the country as a burgeoning market for broadband services.

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