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Modem sales up 88.4 per cent

IDC estimates that modem shipments reached 291672 units, with revenues touching Rs 1.260 billion.

T O D A Y

• Mr Locksmith • Infosys Q1 • Modem sales up

The high growth rate is a direct result of the dramatic increase in the Internet subscriber base in India. Substantial reduction in prices and easy availability has further fuelled this growth.

Intense competition, especially from Taiwanese and other Asian vendors, has led to a dramatic reduction in prices over the previous year.

Among the various speed categories, the 33.6 KBPS modems dominate the total modem market. However, the share of 33.6 KBPS among all speed categories is fast declining as 56 KBPS modems have been registering a steady increase in their sales quarter after quarter.

Speed	Units			Value (rupees crore) Rs 1 crore = Rs 10 m
	1997-98	1998-99	Growth %	1997-98	1998-99	Growth %
Up to 28.8 KBPS	43564	7000	-83.9%	33.0	5.9	-82.1%
33.6 KBPS	111225	231879	108.5%	81.6	94.7	16.0%
56 KBPS	0	52793	N/A	0.0	25.0	N/A
Total	154789	291672	88.4%	1146	125.6	9.6%

Price was perhaps the only factor that mattered in 1998-99. Most vendors decided to play only on price, because of which the Average Sales Values of modems came down drastically during the year.

The importance of using a low-price strategy is clearly evident from the fact that the ASVs of the top three vendors were among the lowest in the market. These three vendors, namely D-Link, Lanbit and GVC, together captured almost 63 percent of the market in unit terms.

UNI

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