Broadband Backfire



According to news reports, the Union Communications and IT Ministry has
scaled down its target for broadband subscribers from 3 mn to 1 mn, by the end
of December this year. Though the DoT has neither confirmed nor denied the
reports, the fact remains that even with the current healthy rate of broadband
adoption, the number of subscribers are not expected to go beyond a million by
the yearend.

According to sources in the Association of Unified Telecom Service Providers
of India (AUSPI), the reason for the shortfall is the fact that despite adopting
the target as in TRAI’s Broadband Policy recommendations, the DoT did not
adopt some key policy recommendations.

On the positive side, there has been a steep fall in broadband tariffs, down
to Rs 250 per month. The prices are expected to plummet further as demand
increases. Indian broadband rates are among the lowest in the world, with charge
per MB of download, as low as Re 1. However, the big bane in the achievement of
targets has been the government’s reluctance to unbundle the last mile.

The DoT policy, which had come out a year back had stated, "if the
targets are missed, the government would consider unbundling." Of the
target of 30 lakh subscribers by December end, only 6.1 lakh subscribers have
been added by September end, of which 350,000 are subscribers of private
operators, while 260,000 are customers of MTNL and BSNL.

According to Deepak Maheshwari, Secretary, ISPAI, "The growth of
broadband today is a lot faster than the rate of cell phone adoption. While the
momentum is big, the base is still too small and a lot more effort is required
to reach the targets. India can heed the example of Japan and UK, where under
similar circumstances, the local loop has been unbundled to increase IT
penetration."

While private players talk about Local Loop Unbundling (LLU) being the key
issue, the incumbents-BSNL and MTNL -say that the progress has been
inhibited because of the lack of content rich services such as IPTV,
video-on-demand, interactive messaging and gaming, issues, which are being
addressed.

Numbers
Game
Number
of broadband subscribers (in million)
  5-Mar 5-Jun 5-Sep Broadband
Policy Target
BSNL 0.03 0.07 0.17 1
MTNL 0.01 0.04 0.09 0.5
Others 0.15 0.29 0.35 1.5
Total 0.19 0.4 0.61 3

Jasmine Kaur

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