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The last fiscal happened to be a reasonably good year for the public mobile radio trunk services (PMRTS) segment. Its subscriber base reached around 37,000 at the end of March 2008, up from 31,558 in March 2007, a growth of around 17%. The total estimated size of the market in value terms was around Rs 38 crore this fiscal, up from the Rs 36 crore last fiscal.

The Agrani Group has a near-monopolistic place in the radio trunking market in the country. The group operates seven brands: Arvind Mills, Aryadoot, Aryaoffshore, German Express, United Liner, Container Movement, and Jet-Aiu. The subscriber base of the group at the end of March, 2008 was 18,337, up from 15,727 at the end of March, 2007, recording a growth of 16.6%. Together the group has a 49% market share.

Arvind Mills recorded a total subscriber base of 11,817, and Aryadoot of 1,649 at the end of March, 2008. Arya Offshone grew slightly from 1,263 in March 2007 to 1,368 in March 2008. Container Movement remained static at 5 subscribers, and Jet Aiu grew from 436 in March 2007 to 511 in March 2008. Another Agrani brand, German Express grew marginally from 880 in March 2007 to 887 at the end of March 2008. United Liner, on the other hand, grew from 1,932 in March 2007 to 2,100 in March 2008.

Agrani Group also has a controlling stake in Procall, which operates four brands in different regions of the country. The brands under the Procall umbrella are: Quickcall India, Bhilwara Telenet Services, Procall, and Smart Talk. While Procall operates in the NCR and Jaipur region, Smart Talk operates in Pune, Vashi, and Navi Mumbai. QuickCall, operates in Bangalore, Chennai, and Hyderabad.

Procall is the most successful brand of the group boasting of 9,708 subscribers at the end of March 2008. And QuickCall, the second most successful brand under the umbrella, boasts of a subscriber base of 4,668 as on March 2008. Smart talk has a subscriber base of 2,449. Bhilwara Telenet Services boasts of 1,392 subscribers as in March 2008. Together the group had 18,217 subscribers by March 2008. Procall Group together has a market share of 49%.

A major development last year for the company was the launch of a next generation digital wireless (radio) solution featuring Motorola's iDEN (integrated digital enhanced network) technology in Bangalore. This is the first time that a digital PTT service has been launched in the country. As of now, Procall is the only company to have acquired the digital public mobile radio trunking license for prominent circles in the country like Mumbai, Delhi, Kolkata, Maharashtra and Goa, Tamil Nadu, Karnataka, and Andhra Pradesh. The company has also applied for licenses in seven more circles, and aims to have over 1.5 mn subscribers over the next two years as a result of the deployment of this technology.

In the last fiscal, Procall received orders from Multi-modal Transit System, Delhi International Airport, Election Office, L&T, North Delhi Power, Chennai Corporation, Municipal Corporation of Hyderabad, GE Consumer Finance, and BEST Undertaking.

The industry is witnessing a shift from pure PTT to other value added services. PMRTS services are mostly available in major cities, ignoring a major part of the country. World over the trunking industry is shifting from analog to digital and this trend is reflected in India as well. While the basic USP of PTT still remains attractive and compelling to largely business users, the market is surely moving from pure PTT service offerings toward a whole bunch of value added offerings. The plain vanilla low-cost services might co-exist with digital in the future, or operators may offer digital as a premium service. It is time that the industry starts offering value added services like GPS.

BPO and the airline industry, with large employee transportation needs registered as the high growth segments; followed by other segments like public utility services, port management, and the construction segment.

The handheld radio segment registered a growth of 16.4% over the last year, mainly because of the entry of a new segment of customers, with high safety application going in for radios like malls, banks, and manufacturing.

According to V&D estimates, there was a drop in ARPU by 3-4% in the last fiscal. Traditionally, the ARPUs in the industry are higher than the cellular industry, hovering somewhere between Rs 800-1,000. Industry players believe that ARPUs are likely to drop further, helping the market to grow. Reducing ARPUs will increase the size of the market as radio trunking becomes affordable by different verticals.

Margins Under Pressure
The industry alleges that the Indian regulatory system sees trunking as a distant cousin to GSM and CDMA technologies, and has a step-motherly attitude about developing this industry. The regulatory bodies have forced non-usage of the dual use of trunking technology, like using Motorola and Kenwood simultaneously. This has increased the infrastructure and routine maintenance costs, which has in turn put a strain on margins.

In addition, OEMs like Motorola and Kenwood do not consider analog trunking as a serious opportunity to manufacture and develop handsets and other applications, or offer after-sales support. This non-availability of handsets/services also impacted the expansion of market size. Unavailability of spectrum is another serious issue facing the operators since the infrastructure roll-out costs are very high.

The Road Ahead
The industry is likely to grow through demands from verticals like BPO, BFSI, retail, and construction.

The industry however has to gear up to offer innovative solutions and increase its reach in smaller cities and towns to fully realize the potential of the market.

Gagandeep Kaur
gagandeepk@cybermedia.co.in