The fourth edition of Deloitte's technology, media and telecommunications (TMT) predictions were revealed on 31 January in Mumbai.
In the technology space, the report revealed that the number of smartphone users in urban India will cross 104 million in 2014 compared with 51 million users in 2013. The report further added that smartphone users are expected to drive the highest video consumption on mobile.
PN Sudarshan, senior director, Deloitte India, said, "In 2014, mobile video is likely to be the preferred service over other mobile value added services. We anticipate 50 to 60 per cent of all the mobile data consumption in India to be driven by video over next two to three years. With improved networks and connectivity, users will increasingly consume higher resolution video.While pre-downloaded and side-loaded form of video will continue to be a major part of the overall video consumption on mobile, Deloitte envisages emergence of innovative business models in mobile video streaming/time-restricted download space in 2014."
The report also said that instant messaging (MIM) services on mobile phones would win the battle for volume in 2014, but short messaging service (SMS) will be victorious in revenue terms. Deloitte predicts that in 2014, MIMs will be more than twice the volume of messages sent via a SMS. However, despite the burgeoning volumes of MIMs, Deloitte expect SMS to generate more than $100 billion globally in 2014, equivalent to approximately 50 times the total revenues from all MIM services. In India, due to the low cost SMS plans due to regulatory changes, the scenario could be slightly different, according to the Deloitte study.
The report adds that local language content will be crucial in 2014. It predicts that India would witness a surge in the development of local language applications and localisation of content, as any incremental increase in mobile data and internet subscriber base would be achieved among the section of the population whose digital accessibility is limited by language constraints. Additionally, Deloitte predicts that regional print industry will continue to surge primarily driven by factors such as under penetration in regional markets, rise in regional ad rates and sustained pressure on English print advertising by digital media.
The report also reveals that a few key innovations in the payment or cashless transaction mechanism would see people stop holding backin segments ranging from e-commerce to banking services like remittances.
Media and Entertainment
Deloitte predicts that the digital TV distribution space – both digital cable and direct-to-home (DTH) would grow given the catalysing effect of digitisation and the headroom for growth provided by non-TV households in the country. Digital cable is expected to gain more out of the densely populated areas with adequate cable infrastructure while DTH is expected to gain more in sparsely populated areas with minimal cable infrastructure.
The report also expects social media to continue to grow as a favoured platform for targeted advertising as its adoption surges, driven by increasing mobile usage and higher penetration of smartphones and a young population.
According to the report, although cricket still reigns supreme in the country, new non-cricket sports properties are expected to emerge and gain popularity. Driven by the success of IPL, other sports such as hockey, badminton and football have also leveraged the model to build similar properties, which are being lapped up by broadcasters and sponsors alike, it adds. The popularity of such sports is expected to continue to witness an upswing, according to the report.
In the telecom sector, the company predicted that in 2014, phablets (smartphones with 5.0 to 6.9 inch screens) will represent a quarter of smartphones sold. After rapid initial consumer success, 2014 may mark a ‘peak phablet’ year, says the report, while noting that only a (sizeable) minority of smartphones users will want to handle such a large device. Two thirds of phablets in 2014 will be less than 5.1 inches, just meeting the definition, and less than 10 percent are likely to be 6 inches or larger, it adds.
The Indian market for rugged devices would double in size in 2014, driven primarily by new device introductions by manufacturers targeting business and government users. Multiple new smartphones/ phablets are likely to be launched in the ‘semi-rugged’ device category, blurring the demarcation between consumer and rugged devices, according to the Deloitte study.