TRAI recently took the first step towards broadbanding India when they presented their recommendations on the subject to the government. The regulator has suggested 12 ways to achieve greater broadband penetration in India. Currently, the broadband penetration in India is only around 0.02 percent.

The minister for communications and IT, Dayanidhi Maran told VOICE&DATA that the TRAI recommendations on broadband and Internet are high-priority areas. "The ministry is deliberating on the recommendations and we will be soon coming out with a decision on them," Maran said.

Not So Healthy
While the growth rate in the telecom sector is second only to China, officials are concerned over the exceptionally low Internet subscriber base and usage rates. The picture gets further blurred when compared with South Korea where there are almost 79 computers and 25 broadband connections for every 100 persons. In India, there are only around 10 million PCs for over a billion people and a dismally low Internet density of 0.4. Add to that the fact that only one person in 100 uses the Net.

Lessons to be Learnt
TRAI recommends that tariffs be cut massively to make broadband attractive to the masses. At present a 100 kbps line costs around $16 in India, compared to Korea where it is less than a dollar. Even in China it is $3. If the recommendations are accepted, this will be cut down to less than $8. Moreover, TRAI has tried to make a case for broadband and Internet by linking their expansion to the country's GDP growth. The regulators have also suggested unbundling of the local loops held by basic operators, mainly BSNL and MTNL. The PSUs have strongly opposed this saying that private service providers cannot share the investments hitherto made, for free. As it does not make sense to lay parallel infrastructure for Net services, TRAI feels that the PSUs should be given five years to extract returns on their investments. This can be through shared unbundling, where others install the DSL and incumbents share revenue, or extract rental. The second option is through bit-stream access where BSNL/MTNL install DSLs and then lease out the connectivity.

TRAI also recommends that multiple access technologies should co-exist without artificial hurdles and effective competition should ensure choice of multiple service providers. TRAI has also suggested 100 percent depreciation on computers, easier norms for donation and recycling of computers, and removal of anti-dumping duties.

Content and Pricing as Growth Enablers
While it is generally perceived that multimedia applications can be popular in the urban areas, rural areas would probably first get hooked on to the educational and e-governance applications. For example, a farmer in Punjab may be more interested in the market price of farm products than Nasdaq stock quotes. The big push, as even TRAI agrees, has to come from government initiatives like putting information online, e-governance, wiring of schools, projects like Bhoomi, e-Seva, and Gyandoot.

Ultimately, as in the mobile industry, costs will determine the number of subscribers, but innovative and apt content will bring in the moolah.

By our Sr Reporter