New Delhi, September 24, 2009 – The shipments of data cards and USB modems crossed the one million mark (1,002,169 nos.) in the 12 months ending June 2009, according to the findings of IDC’s “India Quarterly Data Card and USB Modem Market Review, Q2 CY2009”.

IDC India, the leading IT intelligence firm attributes this to the rapid growth in travel and the need to stay in touch with customers, vendors and business partners 24/7. The communication needs of enterprises have grown to include access to e-mails and corporate applications, as well as personal communication, online transactions and entertainment, the first ever IDC India study in this segment adds.

The sharp increase in the demand for data cards/USB modems in the last four quarters has gone up from 1.76 lakh units in July-September 2008 quarter to 4.05 lakh in April-June 2009. While in the quarter ending July-September 2008 one data card/USB modem was sold for every 4 notebook computers, this number improved to 3.2 data cards/USB modems sold for every 4 notebook computers in the April-June 2009 quarter.

One-thirds of the million data cards/USB modems were sold (shipped) in the first six months – July 2008-Decemeber 2008 – while two-thirds were sold (shipped) in the second half – January-June 2009. Currently the Wireless Internet market is dominated by CDMA operators in the country. CDMA data card/USB modem shipments accounted for nearly 69% of the total market in Q2 CY2009.

The average sales value (ASV) or price of a data card/USB modem is around Rs. 3,000; going forward, with increasing demand, prices are likely to come down. This will help improve the overall penetration of wireless internet/broadband. Currently data cards/USB modems are available mostly in bundled offerings from operators. However, with increasing demand, IDC India expects more open market data cards becoming available, thus providing an opportunity to customers to choose their favourite service provider along with their preferred device.

Incumbent operators (BSNL and MTNL) are pushing 3G data cards/USB modems to increase subscribers on their recently launched 3G service networks. Private telecom operators are yet to launch 3G services in the country.

Figure 1: India Data Card and USB Modem Market
Shipments: ’000s of units, % growth

Source: IDC’s India Data Card and USB Modem
Market Review, Q2 CY2009, September 2009 release

Future Trends

According to Naveen Mishra, Senior Analyst, Communications Research, IDC India, “Going forward we expect convergence to affect USB modems, whereby these devices will not only be used for Internet connectivity but also increasingly for data storage, music (MP3 player) and FM (Radio).”

“USB modems may also see usage as a mobile phone in future avatars as companies experiment with new applications”, Naveen further added.

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IDC India
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