Voice will not compensate for such a disruption, in such an eventuality as voice growth is anyway tapering off a large base (we see voice as a cash cow now whose growth prospects are muted at best).
The new voice subscriber over the medium to long term (for expanding the voice market) is more likely a rural customer with much
lower-than-average company ARPU (not counting the subscribers defecting towards Bharti/Vodafone/Idea from the smaller operators). There is the ARPU vs sub growth trade-off (India telcos can?t have both).
Will data start cannibalizing voice once it hits a threshold of, say 25%+ of revenues (currently, data is 18-20% for the likes of Airtel Vodafone / Idea) and data pricing becomes even more attractive? Almost all other emerging markets have seen this trade-off once data hits critical mass, hits really attractive price points thus precipitating voice cannibalization with the result that blended ARPU increases do not come.
4G will spur data consumption of an order of magnitude higher than current 2G/3G data consumption trends thus resulting in higher ARPUs, we would point out that 4G roll-out in other Asia markets such as China, Taiwan, Hong Kong etc. has not resulted in ARPU
increases through; so, it?s not clear to us why India should be an exception. This might still be 12-18 months away though (so, we admit that we may not be timing this tradeoff finely).
