However, all is not well with the Indian mobile market. Rise in competition, coupled with a rapid dis-proportionate decline in industry revenues, is pinching the incumbents hard, while the new entrants appear to have resigned themselves to a long battle. The current price war, triggered by the new entrant into GSM Tata DoCoMo with its per second pulse plan, has forced other operators to follow suit. In the process, mobile tariffs, that were already significantly low compared to other emerging market peers, sank. However, unlike the past, the elasticity appeared missing. Declining tariffs had led to significant uptick in usage in the past. However, latest results of listed telcos indicate that the usage is flattening, and more worryingly, showing signs of decline. And we are not yet done with launch of all operators. Some of the operators with pan-India rollout license are yet to do so, and there still remains the threat of newer larger global players. And let's not forget the fact that 3G license auctions are yet to be done, and despite the limited spectrum on offer, many expect atleast one more new global player to enter the market.
Does all this mean that the great Indian mobile opportunity is lost? I don't believe so. The current market scenario where there are 10+ operators in a given circle cannot sustain itself. Hyper-competition, whilst good for the consumer in the short-term, results in creating tariff wars with seemingly bottom-less levels. Players with deep pockets and a genuine interest in the market over the long-term will battle it out, and survive. Non-serious players that entered the market looking at it as a get-rick-quick geography will increasingly find their hands tied and will exit, sooner, if not later. Indeed, the present storm appears to forebode a period of consolidation in the Indian mobile market.