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The modem market has been growing consistently for the last few years and this year too, it saw a steady growth of 30.4%; the total  market size being  Rs 270 crore. Broadband emerged as a perfect option for slow dial up services for Internet access last year. The number of broadband connections in India reached to 13.1 lakh in March 2006. Though, world over, the phenomenon of shifting from dial-up to DSL was experienced, but in India even the first time users in the country opted for DSL. That's the main reason DSL technology ruled the market. The next generation will belong to ADSL broadband modems with BSNL all set to roll out its broadband service using ADSL. 

In FY 2005-06, the DSL market grew by 27% in terms of units, but the growth in revenue was a meager 8%. The prime reason for this was the significant drop in prices and availability of low cost solutions. With the continuous evolution in technology and changing demands, the modem market is expected to grow at the rate of 15%.

The Players
Atrie Technologies emerged as the top player in the modem market with the revenue of Rs 76 crore and market share of 28.1%. MRO-Tek, remained at the second position with the revenue of Rs 74 crore and market share of 27.4%. The company bagged orders from a number of verticals ranging from banking to service providers to public sector organizations. The largest project that Atrie undertook was for HFCL Infotel,. where it installed more than 20,000 modems.

 D-Link lost its top position in FY 2005-06 and came in third with a decline of 32.4%. Despite selling five lakh units, its revenue for FY 2005-06 was Rs 48 crore. This can be mainly attributed to the declining prices and slug in the dial-up segment. Moreover with ISPs providing bundled packages to consumers, the demand for stand-alone modems has gone down. As such, the prices in India are the lowest when compared to the international market, mainly due the size of the business and competition.

Bharti Teletech posted revenue of Rs 36 crore from modems and registered the highest growth of 260%. Dax Network's revenue dropped from Rs 7 crore to Rs 4 crore, further lowering its market share to 1.5%. The other players in the market took 11.9% market share with total revenue of Rs 32 crore.

The Future
The DSL business will get bigger in size, as the demand for ADSL is increasing from the SME and SOHO segments. With enormous copper in the last mile available with them, MTNL and BSNL will continue to drive the growth of modem market in India turning their copper into gold.

The IDSL 64/128 k leased line will remain popular among verticals such as banking and finance due to the advantage of security that they provide. Another area, which is expected to see significant growth, is leased lines with more deployment again from the banking sector. According to global reports, ADSL accounts for seven out of every ten broadband lines. With India joining the broadband wagon in a big way, the future of modems looks bright.

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