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TRAI, DoT spar over details of India’s mega fibre broadband plans

The Telecom Ministry and the Telecom Regulator have crossed swords over the role of state-owned Bharat Sanchar Nigam (BSNL) in the Rs 60,000 crore ($14 billion) National Broadband Plan.

While the Ministry wants BSNL to implement the scheme, the Telecom Regulatory Authority of India (TRAI) has warned that such a decision may amount to indirect subsidy of the ailing corporation. BSNL has been posting tremendous losses as consumers shift away from the red-tape laden government company to more agile, private sector competitors.

TRAI, in its remarks on the Ministry’s plan, pointed out that BSNL may utilize the tremendous subsidies for setting up and running the National Fibre Optic Network (NOFN) to hide its own losses and inefficiencies.

“..the proposed scheme of Department of Telecom runs the risk that BSNL cost may be offloaded on NOFN… This will result in high cost
of broadband provisioning to the customers. .. this may become an indirect method to subsidise operations of BSNL,” TRAI pointed out in its letter to the Department of Telecom within the ministry.

According to the ambitious plan – the finalization of which has been incorporated into the new telecom minister Kapil Sibal’s 100-day program – the government will put up a massive infrastructure across the country to enable private telecom operators to plug in and offer broadband connectivity.

The infrastructure, which will take the form of a nationwide network of high-capacity fibre optic backbone, will extend to every habitation, according to TRAI’s recommendations, and to every Panchayat, according to the Ministry. India has around 6.5 lakh habitations, which fall under 2.5 lakh Panchayats (a local government unit.)

BSNL has already failed to carry out government’s ambitious designs in extending broadband connectivity. Against a target of 20 million connections by 2010, India has just around 11.5 million connections even now – making it one of the poorest countries in broadband penetration in the World – at just 1% connectivity.

Both DoT and TRAI also differ on how ambitious the program must be. While the Government is not keen on setting up another target – particularly after missing the last one spectacularly; TRAI wants clear targets.

“Targets are necessary to concentrate efforts to reach the goal-post,” the Authority wrote to the government last week. According to TRAI, the target should be to take broadband connections from 11 million to 75 million in by the end of next year and 160 million two years later.

The ministry, however, is averse to setting such targets and claimed that its job is over when it makes the ‘supply’ available. “At this state, it may not be feasible to indicate targets,” it pointed out.

Similarly, TRAI wants to raise the specification for broadband from the current 256 Kbps (42 KBps) to 512 Kbps while DoT is against it. TRAI pointed out that 256 Kbps is poor compared to standards and speeds available in other parts of the World and keeping it there would result in “serious quality of service issues.” Most advanced countries have average speeds of around 2000 Kbps, while countries such as Korea have 10,000 to 30,000 Kbps speeds on home broadband.

TRAI has also opposed the Government’s suggestion that the scheme should not be concerned with creating broadband connectivity in bigger cities and Metros, which it believes, has been addressed by private sector companies.

The regulator pointed out that contrary to what the Government feels, “large cities as well as metros do not have an optic fibre access network, barring an occasional city like Jaipur.” Most of the data, TRAI said, is carried over wireless rather than fibre to home or office.

Out of the 11.5 million broadband connections, nearly all of which are in the big cities, only 0.28 million are delivered to the destination over fibre, it pointed out.

“..the need for high-speed bandwidth to an optic fibre networks in the form of Fibre To The Home (FTTH) cannot be overstated,” it said.

According to the Authority, out of the 75 million broadband connections that India should have at the end of 2012, 17 million would be over copper, 30 million over cable and 28 million over wireless.

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