Indian Callers Raise Hopes for Mobile Ads Boom

11 March 2008

MUMBAI: India's telecoms executives are talking-up the rupees to be made from cellphone advertising, as eight million of the subcontinent's citizens sign up to mobile services each month.

In a nation of one billion-plus people, nearly two-thirds of whom live in rural areas, cellphones are the medium of choice when access to television, the internet or newspapers is limited.

Hypes Manoj Dawane, ceo of advertising software firm People Infocom: "In India, mobile phone penetration is high compared to other forms of media like television or the internet. You can't have a better place than India for mobile advertising."

PricewaterhouseCoopers estimates that of 200m Indian households, 115m owned a TV last year - but there are already 250m cellphone users, a figure that is expected to double in the next five years.

Adds Prasanth Mohanchandran, executive director of digital services at Ogilvy & Mather in Mumbai: "The mobile phone is the only [medium] that already reaches so many people."

To maintain growth, mobile providers must keep call costs low. Although the economy is booming and the middle classes are increasingly affluent, more than half of India's workforce earns less than $3 a day.

Advertising offers a way to subsidize costs to subscribers. Mumbai-headquartered cellphone operator BPL Mobile is mulling a service that would reward customers for listening to commercials and other information over the phone.

Overall ad revenues in India have grown more than 20% annually for the last five years, reaching more than $5 billion (€3.25bn; £2.47bn).

Data sourced from Wall Street Journal Online; additional content by WARC staff