Nasscom’s Operation Bandwidth

Nasscom considers that there are two broad ‘bandwidth’

challenges to India that need to be addressed on priority by 2005:

• To enable,
  
  through the operation of a vigorous and innovative market, the creation, in
  
  any location, of centers of Indian ‘bandwidth excellence’ which are
  
  capable of matching the bandwidth supply conditions in terms of innovation,
  
  quality and price for bandwidth prevailing in the emerging centers of
  
  e-commerce excellence in North America and Europe and

• At the same time
  
  to find appropriate and empowering ways of meeting the challenges of
  
  providing affordable, quality and timely access to bandwidth, to enable
  
  Indians living in regional, rural and remote areas to participate fully in
  
  the information economy.

Nasscom

recognizes that the existing predominantly telephony-based regulatory and policy

environment is no longer tenable in an era of diverse and multiple communication

needs. Nasscom considers that the way these objectives are met, needs to be

re-thought creatively towards a quite different globalized environment which is

being increasing dominated by an Internet paradigm.

Global outlook

A revolution in information networking is creating an

unprecedented global change and is vividly brought out by the following

mind-blowing statistics:

• While it took a
  
  century to install the world’s first 700 million phone lines, 700 million
  
  more lines will be required over the next 15-20 years. This means 630,000
  
  lines during the next week

• There are more
  
  than 200 million wireless subscribers in the world today. There will be 700
  
  million more over the next 15-20 years–50,000 each day

• While there are
  
  more than 200 million cable TV subscribers in the world today, there will be
  
  300 million more over the next 15-20 years

• In the next two
  
  years, there will be 1,000 new providers of telephone, Internet and wireless
  
  communication services

• 58 million Km of
  
  fiber cable is to be globally deployed during 2000–enough to circle globe
  
  1,450 times.

Globally, communication ‘consumption’ is increasing,

spurred by low costs and high bandwidths. As the world adopts the ‘network

computing’ model, the requirements for communication infrastructure will grow

exponentially. To meet this demand, practically all components of

telecommunication technologies are turning digital with the price-performance

ratio halving every 18 months. Thus, high bandwidths are increasingly emerging

as the standard for networking applications.

Three key international trends are expected to drive them:

INCREASES IN CAPACITY: Submarine fiber optic

capacities for both Trans-Atlantic and Trans-Pacific routes are expected to

increase four to seven folds by 2000 as against 1996.

FALL

IN TELECOM COSTS: International telecom costs are in a free fall. Costs of

leased circuits between Europe and the US have dropped to 50-80% of 1990 price

levels.

DEMAND FOR APPLICATIONS: Demand will grow for

applications such as broadband Internet and multimedia that require

significantly higher bandwidth than today’s applications.

Bandwidth will increase to accommodate Internet content such

as image files, video-laden Web pages, animation and streaming media. By year

2002, it is expected that 25% of the US Internet users will have broadband

access and e-commerce players will launch broadband services, both in parallel

to their existing narrow band and as exclusive services.

It is not surprising that several countries have been

aggressively developing state-of-the-art national information infrastructure,

which can leverage the global information infrastructure. Singapore and Malaysia

are some of the examples in Asia, who are making huge strides in this area.

Singapore was the first country to develop an ATM base

broadband multimedia network, which will help the country develop into a major

IT hub for the Asia-Pacific region.

Malaysia has developed a multimedia super corridor by linking

its 12 cities through a 700-km fiber optic backbone providing a bandwidth of

2.5-10Gbps. Access to this network is provided through fiber to the home. This

facility is provided with guarantees of stringent performance levels and very

low tariffs.

_{General recommendations}

BANDWIDTH AVAILABILITY: The government’s principal

focus of polity attention in relation to bandwidth issues needs to be on

transforming bandwidth capability into bandwidth availability by developing

competitive and responsive market conditions, particularly in the customer

access network and provisioning of trunk capacity.

300GB BY 2005: The Internet penetration must rise

through increased bandwidth for access and lower access charges. National

Internet Backbone (NIB) is expected to play a major role in the growth of

IT-enabled services and therefore bandwidth availability on NIB should be large

enough to bring down bandwidth cost. Supply of bandwidth needs to automatically

precede the demand.

By

the year 2008, it is estimated that 2.5 million employees will be working in IT

companies in India. It is estimated that the total connectivity required from

India for IT companies alone would exceed 250GB. Planning must be done today to

provide for such high bandwidths in future, which must be available at short

notices. As the requirement for manpower increases, and as we develop more and

more development facilities in different parts of the country, we need to

increase the domestic bandwidth available to support these centers. DoT must

plan to increase domestic bandwidth across various cities. These must be

available in reasonable time frames (maximum one month).

RURAL AREAS: Improvement of the telecom infrastructure

in the rural areas has to be speeded up. nx64Kbps and 2Mbps leased circuits on

reliable medium should be made easily available up to taluka level and 64Kbps

leased circuits at village level by the end of 2000. This would require India to

have a cost-effective telecom infrastructure. Efforts would be required not only

from the Department of Telecom Services but also from the private service

providers.

DOMESTIC EXCHANGES: Domestic Internet exchanges should

be set up on priority basis.

INTERNET KIOSKS: Popularization of Internet kiosks or

dhabas will improve access to the Internet for those who cannot own computers or

do not have an Internet access. (ISPs and telecom companies may work towards

achieving this.)

PENALTIES: The penalties for damage (and limits on

liability) to cables should be increased at the earliest opportunity in order to

create a more effective deterrent to unnecessary disruption of these key

elements of the national information infrastructure.

ADVISORY GROUP: The government should convene a

high-level industry advisory group to advice and coordinate India’s

requirement for Internet bandwidth.

ASIAN CLUB: Government of India should join forces

with other Asian countries and open a dialogue with the US on the issue of high

charge being paid for the Internet traffic.

DEMAND STIPULATION PROJECTS: Demand stimulation

projects should also be used to encourage the development of content and

applications to support these online services. This will also assist in the

development and retention of online skills in India, which is also part of the

problem.

Collaborations in the multimedia industry, particularly on

global projects, should be pursued by the industry and the government working

together to develop network solutions which allow them to move large amounts of

digital material in the interests of greater competition and efficiency in the

use of resources.

ACTIVE GOVERNMENT SUPPORT: The government should

review the possibility of supplementing funding for telecommunications bandwidth

infrastructure, services and content through consideration of further financial

support for infrastructure, service and content investment.

Industry Specific

ACCESS OF INDIA-BASED PERSONNEL FOR CUSTOMER SUPPORT:

Customers are required to contact employees of Indian IT companies on an ongoing

basis for support, status reporting and negotiations as part of project

execution. Most of the US IT companies have set up toll-free numbers for such

support and the call gets routed to the appropriate extension of the employee or

to his/her cell phone or residence number if the person is not in the office.

The technology for such call routing is built into all EPABX systems today.

Charges for such calls are picked by the IT company or the customer. According

to Nasscom survey, such charges do not exceed 15 cents (Rs 6) per minute and in

some cases are as low as nine cents (Rs 4) per minute.

Indian IT companies have set up dedicated telecommunication

links to the US through VSNL or STPs and are using these links for data

communications. These lines can easily carry voice traffic (they are digitized

anyway), and if they can be connected to PSTN in India through the EPABX then

they can route a call to the relevant extension or the residence or cell phone

number. The facility to connect the international telecommunication links to

PSTN on either side may be provided to software export companies. This will

ensure that India’s foreign competitors do not have an undue advantage in

customer service.

This will also help India become a customer service hub in

future and attract various organizations to set up their customer service

centers in India. This business alone is projected to bring in an additional $30

billion in foreign exchange by the year 2008.

INTERCONNECTIVITY ACROSS MULTIPLE NETWORKS: All forms

of content–voice, image or video–are getting converted to IP traffic and are

being sent over the same network. End-user phones are becoming digital and you

can use your PC or an IP-phone to talk to a remote person, he/she being on a

regular phone, mobile phone, or a PC or IP-phone. As world-class IT companies,

Indian companies are expected to leverage technology to provide ubiquitous

access to their employees to corporate as well as customer networks. For

example, an employee must be able to check e-mail using a remote PC, a regular

phone or a PDA. This requires interconnectivity between all forms of networks.

In India, multiple service providers are emerging to provide

connectivity solutions. Some of these vendors can provide better connectivity

solutions–some of them can provide these solutions faster and some others can

service the requirements better. Sometimes, service providers other than DoT are

the only solutions available. Here also, interconnectivity between networks of

different service providers must be allowed.

REDUCTION IN TARIFFS FOR INTERNATIONAL CONNECTIVITY:

There is a requirement of large bandwidth for our customers internationally,

with more and more work being done in India. The work is becoming

mission-critical to them. Such bandwidth is required in the development of

multimedia and Internet-based e-commerce applications. In the US, coast-to-coast

connectivity of 56Kbps costs around $600 (frame relay) to $1,000 (leased line)

per month. The cost of a 1MB link is around $4,000 per month–which means about

18 times more bandwidth for 4 times more cost. The tariffs are discounted

heavily as the volume increase.

Similarly, the cost of a 64Kbps link from the US to the UK is

around $2,000. Here also, the discounts are deep for higher speeds.

The charge for a 64Kbps link to India from the US is around

$5,000 per month. For 1MB, the charge is $35,000 per month.

In India, the tariffs need to be reduced drastically to

encourage more value addition. Also, volume discounts must be steeper so that

companies can take more bandwidth and provide better customer service.

24X7 SUPPORT OF DOT LINKS: Indian IT companies operate

beyond the normal eight-hour workday; sometimes they operate round the clock.

DoT is not totally equipped in all cities to provide 24x7 support needed to

operate in the global markets. Also, most of the companies are dependent on DoT

to provide the last-mile connectivity. So the service becomes critical to the

survival of the IT companies.

LOW-COST INTERNET CONNECTIVITY TO SCHOOLS AND COLLEGES:

India needs to produce more IT professionals to meet the demands in future. It

is estimated that we will grow from an estimated 340,000 IT professionals to 2.5

million professionals by the year 2008. This will require exposure to IT for all

college and school students. Also, in a knowledge economy, IT exposure is

required of all future employees. In order to make this happen, we need to

introduce Internet connectivity for all schools and colleges. The government

must provide low-cost Internet connectivity to all schools and colleges in all

parts of the country.

INTER-CONNECTIVITY OF CALL CENTRES: There is a strong

need to permit inter-connectivity between call centers. The drivers include:

• Ramp up ability for disaster recovery

• Load sharing between the centers for optimum utilization
  
  of expensive resources (international bandwidth)

• 24x7 support for critical operations: Even a few minutes
  
  down time is not acceptable to international customers and can lead to loss
  
  of credibility

• Interconnect two facilities through fiber optic cable:
  
  This helps companies to establish customer/expertise specific centers of
  
  excellence. They should be viewed as extensions of the first

• International call center: DoT maintains that it is not
  
  permitted. The guidelines need to be reviewed in consultation with the
  
  industry.

REDUCE DELAYS IN PROVISIONING OF INTERNATIONAL BANDWIDTH:

International bandwidth is the lifeline for the IT-enabled services business.

Intelsat (the only carrier permitted) transponder capacity is constraining. This

is severely restraining the industry from realizing the true potential of a huge

international opportunity. In keeping with our earlier suggestion, it is

suggested that the IT-enabled services (at least call centers) companies be

permitted to establish their own international gateways and use alternative

satellite networks. We understand that there have been early moves to liberalize

this framework at DoT. A delay in provisioning of international bandwidth

impacts business growth.

SCARCITY OF INTERNATIONAL BANDWIDTH ON FIBER: Many

processes of IT-enabled services companies are dependent on high uptime of

telecom links. Unfortunately, the options permitted are limited. It is therefore

suggested that the IT-enabled services companies be permitted to directly

negotiate the capacity requirements with the international fiber optic

companies.

WEB-BASED CALL CENTERS: Allow Web-based call centers,

i.e. voice over internet or interconnectivity between call centers and the

Internet, which can facilitate users to receive calls from customers at home.

This would lead to greater employment generation.

DQ