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Summary

Viber recently announced that India was its biggest market and WhatsApp stated that the country was its second-largest market. India’s mobile user base is growing rapidly, its mobile broadband subscription growth is strong, and handset sales in the country are booming. Taken together, these factors show that India is becoming a hot spot for social messaging services.

Chat apps are shaking up Indian communications

Ovum estimates that there are currently more than 80 million social messaging users in India. This figure might seem small compared to the country’s massive mobile user base of 900 million plus, but the viral nature of these services means that India is at an inflection point, and in 2015 will witness strong and quick growth of chat apps throughout the market. The government-led Digital India initiative, which will offer high-speed Internet access, is supporting the trend for social messaging, as are initiatives from smartphone and equipment vendors to bundle data packs with handsets, and lower data prices from operators.

The Indian market is on the verge of a digital revolution, as shown by the growth of e-commerce activity, the explosive growth of smartphone-driven services such as Uber, and, of course, the growing social messaging trend. Social messaging apps are clear leaders of this revolution: their intuitive services and convenient interfaces have overcome obstacles such as literacy and language and made them accessible to all segments of the mobile user base. As these apps evolve beyond messaging the Indian mobile user will enter a world in which essential utility services, payments, e-commerce, consumption of media, and even location services are all carried out on these platforms.

Ovum estimates that there were more than 45 million social messaging users in India in 2013, and that this number grew to more than 80 million in 2014. WhatsApp is the dominant player, with 70 million monthly active users in 2014; Hike has more than 35 million registered users; and Viber is growing strongly, with 33 million users in the country.

Mobile operators lost more than $1.5bn in potential SMS revenues in 2014 due to the popularity of social messaging services. Things will get even more difficult for operators when chat providers begin to launch voice and other services on their platforms. This will impact not only the primary revenue stream for mobile operators – voice revenues – but also other potential revenue streams such as mobile video and music.

Appendix

Further reading

OTT Communications Tracker Overview: 1Q14, TE0003-000799 (October 2014)

OTT Communications Tracker: 1Q14, TE0003-000783 (August 2014)

Consumer Insights Snapshot: Messaging: Developed versus Emerging Markets, TE0003-000778 (July 2014)

India Update, July 2014, TE0016-000201 (July 2014)

“Under new government, India inches closer to digital dream,” TE0016-000213 (December 2014)

Author

Neha Dharia, Senior Analyst, Consumer Services

neha.dharia@ovum.com

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