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India's fixed communication services revenue to grow at 5.8% CAGR by 2026: Report

India's fixed communication services revenue to grow at 5.8% CAGR by 2026: Report
Photo Credit: Pixabay
21 Jun, 2022
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The revenue generated from fixed communication services in India is likely to witness an incline at a compound annual growth rate (CAGR) of 5.8% to $9.8 billion by 2026, from $7.4 billion in 2021 according to recent estimates by GlobalData, a market analysis firm. The growth can be attributed to a significant rise in the fixed broadband segment.

With the population shifting towards over-the-top (OTT)-based models, the circuit-switched subscriptions and fixed voice average revenue per subscriber (ARPU) levels have come down. This is expected to cause a decline in fixed voice services revenue at a CAGR of 4.9% over 2021-2026.

“Fixed broadband services revenue, on the other hand, will increase at a CAGR of 7.5% during 2021-2026, driven by the solid growth in broadband subscriptions, especially fibre broadband, and increasing broadband ARPU levels,” said Srikanth Vaidya, telecom analyst at GlobalData.

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GlobalData further estimates fibre optic lines to hold over 75% of total broadband lines in 2026, supported by the government and operator investments on fibre network infrastructure and Fiber-To-The-Home (FTTH) service expansions. As a result, fibre optic service revenue is expected to grow at a CAGR of 12.1% between 2021 and 2026.

Reliance's JioFiber has now become the top fixed-broadband provider across the nation, followed by Airtel and BSNL. The telco is set to lead the country’s fixed broadband services market in terms of subscription share over the forecast period, supported by its strong position in the growing fibre broadband service segment and efforts to upgrade its FTTH network. 

The operator’s promotional offers on its broadband plans are expected to help the company maintain its leadership in the market over the forecast period.

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Airtel has also recently launched its high-speed FTTH broadband service – Airtel Xstream Fiber - for customers in Leh (Ladakh), and Port Blair (Andaman and Nicobar Islands) and plans to scale the service to several remote locations in the country.

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