The Next Big Growth Market

In my opinion, the next big growth market is:

mobile-broadband-and-telecommunications

  • Not here in the USA, though some US based companies are definitely going to benefit from it.
  • A modern day version of a big industry.
  • Due for huge growth.
  • Not China, though that is certainly one to consider.
  • Have you guessed it yet?

The next big growth Market will be India.

Specifically, the mobile online access and marketplace within India. Lets look at some of the numbers regarding the Telecommunication Market in India. (all data is from Wikipedia and current as of December 2013)

Telephone Subscribers (Total)

915.19 million

Fixed lines

28.89 million

Mobile phones

886.3 million

Monthly telephone additions (Net)

5.5 million

What strikes me first regarding this table is the discrepancy between Fixed Land Lines and mobile phones. Clearly, when it comes to telecommunications, India is a mobile society.

According to the Internet And Mobile Association of India (IAMAI), the Internet user base in the country stood at 190 million at the end of June, 2013. As of October, 2013 report, it is over 205 million. The number of broadband subscribers at the end of May 2013 was 15.19 million. Cumulative Annual Growth rate (CAGR) of broadband during the five-year period between 2005 and 2010 was about 117 per cent. DSL, while holding slightly more than 75% of the local broadband market, was steadily losing market share to other non-DSL broadband platforms, especially to wireless broadband.

The fact India’s mobile wireless technology is outpacing traditional land line broadband access is a sign that building out this infrastructure is not only more efficient but also less expensive than building out traditional wired infrastructure. Of course, since all wireless connectivity has to connect to a grounded point of presence eventually, upgrading the current wired infrastructure is critical to delivering consistently high speed bandwidth.

This model proves to be a good indication of what will continue to happen internationally. Mobile is going to continue to be a high growth industry in the developing world.

It is for this reason that I recently bought two stocks who are top market leaders geared towards providing mobile online content world wide. I know everybody is talking about a market correction, and this may very well be the case, but the recent dip in price last week provided an attractive entry point into this high growth market.

UBNT: Ubiquiti Networks provides network infrastructure for wireless broadband, wireless systems, and routing. They are deployed in 180 countries worldwide and provide wireless LAN infrastructure, video surveillance products, and machine-to-machine communication components.

FB: India is the fastest growing segment for Facebook and recent acquisitions such as WhatsApp, which is device independent, are ideally suited towards such a social and mobile demographic.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s