Backed by rising video data consumption on over the top (OTT) players, mobile data traffic in India grew by 109% in 2018, with 4G alone contributing 92%.
Average data usage grew by 69 % in 2018 to touch 10GB a user per month in December, as per Nokia's annual mobile broadband India traffic (MBiT) index released on Thursday.
OTT players have gained significantly due to operator tie-ups and aggressive 4G network expansion, with high consumption on their platforms. WhatsApp and Instagram are the leading social networking app among subscribers, the report said.
The total number of 4G mobile user stands at 432 million, a jump of 147 % compared to 2017, as lower data tariffs and affordable devices continued to boost usage. However, the current broadband penetration in India is around 45%, which is at a much lower level compared to China at 72%, and other European nations at around 85-95%.
"The surge in broadband consumption is likely to continue in the next few years since the current broadband penetration is just 45% in the country," said Sanjay Malik, Head of India Market, Nokia said.
Video streaming continues to remain a major contributor to mobile data traffic constituting 70-80% of the total traffic. Over a 90% fall in 4G data prices over the last five years has fueled video streaming in the country and the emergence of short format videos in several social networking apps like Instagram and TikTok has led to deeper engagement levels.
For telecom players, the 4G market has become the new battleground as the only silver lining in the sector is rising data consumption. Incumbents like Airtel and Vodafone Idea have been facing financial constraints with declining margins since the entry of Reliance Jio.
4G has taken off with dirt cheap data tariffs and free voice calls offer from Reliance Jio in late 2016, which was matched by competitors. The disruption shook the market which led to a consolidation phase where three players – Reliance Jio, Vodafone Idea and Airtel have been left along with a telecom PSU BSNL/MTNL.
While Reliance Jio operates a pure play 4G/LTE network, other players are expanding their 4G network. Airtel and Vodafone Idea both are in the process of refarming their spectrum for 4G use. Out of the 1 billion mobile users, around 450-500 million are connected to the internet, so the opportunity for players is huge.
The 4G network rollouts will continue this year and the service providers will start preparing the networks for 5G to gain early mover advantage.
Interestingly, the 4G growth has come at the cost of 3G data traffic, which has suffered a marginal decline in 2018. "By the end of 2018, there were more than five times as many 4G subscribers as there were 3G subscribers," the report said.
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