Digital India won’t take off if things don’t change
The increasingly acrimonious debate over net neutrality seems strange in a country that is among the worst-connected globally. While a small urban minority has access to mobile internet, app stores and online shopping, the majority of India’s masses are still not aware of what the internet is all about. The recent Trai recommendations on deepening broadband in the country shows India is ranked 142nd globally in internet user penetration (behind Bhutan); 125th in fixed broadband; 113th in wireless broadband and 75th in household penetration among developing countries. In ICT access and ICT use, India comes in at 129, behind even Sudan. Against a target of 175 million broadband connections by 2017, and 600 million by 2020, India is currently at a mere 85 million—that too at a speed of 512 kbps while the targets are for speeds of 2Mbps. And in contrast to other countries where the share of fixed line broadband is very high, that in India is very low. Naturally then, Trai plumps for more fixed lines and even a 5-year moratorium on licence fees for such broadband. There are also eminently sensible suggestions on rationalising very high right-of-way charges by states/municipalities, more efficient use of the existing optical fibre and even copper fibre networks—one way out is to force MTNL and BSNL to unbundle their networks and allow private players to set up broadband connections on their copper fibre.
Given how the National Optical Fibre Network (NOFN) project has achieved less than 5% of its target of connecting 250,000 gram panchayats by March 2014 by optic fibre cable, it is not surprising Trai comes down heavily on the R20,000 crore project, entirely funded out of forced contributions by telecom subscribers—5% of adjusted gross revenues of mobile subscribers mainly goes towards this Universal Service Obligation Fund (USOF)—and recommends a complete overhaul of the NOFN organisational structure, to emulate the Delhi Metro model which has worked so well since it was liberated from bureaucratic inertia.
While more landlines is important, if the existing structure has not delivered, it is unlikely it can be fixed soon. It is better to concentrate on fixing mobile broadband since that is where the growth is coming from right now. And despite being in power for close to a year, the government hasn’t been able to do much on this front. While Indian telcos have an average of 18 MHz of spectrum versus the global average of 50 MHz, the government’s refusal to add more spectrum to the kitty in the recent auctions has only made matters worse since spectrum costs have also spiralled. If OTT players like Skype who are eating into telco revenues are not licensed to provide a level playing field—that’s what the net neutrality debate really boils down to—telco revenues will get further squeezed (see our page 1 story on this today). Apart from the urgent need to announce liberal spectrum sharing/trading guidelines, Trai points to the need for an independent Wireless Planning Coordination (WPC) cell which can actively ensure proper planning of wireless spectrum and making it available. Indeed, given the complete failure of the USOF, it would be a good idea to scrap this levy; with the greater resources, private telcos would then have more resources to develop the broadband internet India so desperately needs.