India has grown by leaps and bounds in mobile penetration but in the wireline broadband segment, the country is lagging its global peers.
To bring all rural areas under the internet connectivity, there is a need of expanding the broadband network through fibre. The State run telecom player BSNL holds over 58 % market share with 120 Lakhs users, followed by Bharti Airtel with 20 Lakhs users.
The wireline broadband segment will be a big opportunity for the industry going forward, especially for telecom players which are facing acute financial stress. It could be the next growth engine along with TV/DTH services.
The wireline broadband subscriber base can increase to 10 Crores households by the fiscal year 2024 and the revenue generated from these segments could expand to Rs 80,000 crore according to a report by research agency Icra.
The first and foremost challenge is of replacing copper with fibre. Unfortunately, we had no plan as many other countries had about fibre deployment. The UK, for instance, had fibre by 2010. In India, currently, operators don’t have resources to replace the entire copper network, Faisal Kawoosa, founder, consulting firm TechArc said.
The Indian telecom industry has mainly invested in mobile networks, ignoring the wireline segment which could have become an alternate source of revenue for them.
The wireline broadband penetration in India is much lower as compared to international standards and presents a significant opportunity for telcos. In India, the wireline broadband coverage would largely expand through the Fibre to the Home (FTTH) networks which have the capability to deliver high speeds with stability in the network, according to Icra report.
High speed broadband is crucial for the Government’s ambitious programme to connect the country through Digital India.
In the new digital communications policy, the government aims to provide ‘Broadband for All’ by 2022. To achieve this, the Government plans to soon revise the minimum speed of a broadband connection to over 2 Mbps immediately and then upwards to 5Mbps. Currently, the minimum broadband speed stands at 512 Kbps. The last revision in broadband speed was done in 2011 when the minimum speed was revised to 512 Kbps from 256 Kbps. A revision has been pending for long.
The proposal, when finalised, will mean the download speed cannot go below 2 Mbps on a wired broadband connection. This is bound to improve the quality of services in terms of data speed and access. But, experts say this means huge capex investment by the telecom players.
To provide last mile connectivity, the Department of Telecommunications has envisaged setting up 50 Lakhs public WiFi hotspots by 2020 through a National Broadband Mission. A Fibre First Initiative will also be implemented to take Fibre to the home. Currently, there are around 38,000 WiFi hotspots across India via official estimates. Though, experts say the number could be higher to around 60,000.
Internationally, in order to monetise the wired broadband networks (Copper / FTTH) better, players in many mature markets like USA, UK, Germany offer integrated services – television, wireline services and home broadband through a single tariff plan, at a significant discount to individual services. A similar trend is expected to play out in India as well. The silver lining for telecom industry continues to be rising data consumption, thus demanding new avenues of accessing high speed internet where fibre broadband will fit in perfectly.