Consumer spending on mobile services dips sequentially in Q4
Consumer spending on mobile services in India slumped sequentially in the fourth quarter of FY24, which was reflected in lower revenues for telecom operators from their postpaid services business as well as reduced payouts for data services, according to an assessment collated by the telecom regulator.
User spending on mobile services (post-GST) rose a modest 1.4% sequentially to about Rs 55,524.5 crore in the fourth quarter of FY24 — 44% lower than the 2.5% sequential growth clocked in the third quarter of FY24 — as per latest sector performance data issued by Telecom Regulatory Authority of India.
According to analysts, the sequential dip in postpaid service revenue in the fiscal fourth quarter was caused by rising sales of low-value M2M (machine-to-machine) SIMs or 'connections'.
«Postpaid net revenue was down 1.9% QoQ (quarter-on-quarter) to around Rs 5,089 crore in Q4FY24, while postpaid ARPU (average revenue per user based on net revenue) was also down 0.7% QoQ to Rs 188, probably on rising (sale of) M2M SIMs, which have a much lower ARPU,» ICICI Securities said, analysing Trai's telco consumer spends data. As per industry estimates, the ARPU from an M2M connection is Rs 40-50, or about a fourth of mobile ARPUs. Typically, M2M SIMs are embedded in machines like smart metres and usually sold in bulk by operators.
Overall consumer spending on data services also rose merely 1.4% sequentially to Rs 48,222 crore — well below the 3.4% on-quarter growth reported on this count in the third quarter of FY24.
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