India needs Rs 4.2 trillion investment for broadband push

The country would require over Rs 4.2 trillion investment under the public, private partnership (PPP) mode by 2030 for ubiquitous broadband penetration, according to estimates from EY.

The same assumes significance as the country, especially the rural areas, lag in fixed or wired broadband penetration compared to developed nations.

According to Broadband India Forum, even as the average data consumption of 187 GB per month in India on fixed broadband is 10 times higher than mobile data consumption, the same is still significantly lower than the US data consumption of 641 GB per month.

Furthermore, fixed broadband subscriptions in India are a mere 2.85 per 100 persons and it is almost one-fourth of the global average. Currently, there are 40 million households in the country that are connected with broadband, according to EY.

“India stands at 13% on home broadband penetration, this has to go up to 80%. This means that out of 300 million households in the country, we need to see atleast 250 million of them having home broadband,” said Prashant Singhal, EY Global TMT (technology, media & entertainment, and telecommunications) emerging markets leader.

“The faster we do that, the quicker we can achieve our goal to become the third largest economy in this world,” Singhal added.

According to the break-up provided by Singhal on the Rs 4.2 trillion investment, fibre deployment will need investments in the range of Rs 2.7-3 trillion, passive infrastructure would require Rs 90,000-96,000 crore, WiFi and in-building solutions Rs 6,600-Rs 9,000 crore, data centres Rs 9,700-Rs 14,100 crore and satellite broadband services Rs 26,000-29,000 crore.

TV Ramachandran, president of Broadband India Forum said, “with fixed broadband data usage reaching 10-20 times mobile data consumption per capita, we need a minimum 20% annual growth rate in fixed broadband subscriptions over the next six years to reach just 100 million additional fiber connections”.

According to Ramachandran, for a significant broadband push, there is a need to leverage the network of 80,000 local cabel operators (LCOs) , over 5,500 public data office aggregators (PDOAs) and over 1000 smaller ISPs (internet service providers).

Industry experts suggested there should be a free broadband by the government capped to certain usage of data so that people especially in rural areas are not restricted to buy Rs 5 or Rs 10 internet sachets.

Besides, they suggested reduction in right of way (RoW) costs, encouraging partnerships with LCOs, levy on high Arpu (average revenue per user) subscribers for rural broadband, as well as asking companies to use CSR (corporate social responsibility) funds for building the required infrastructure, to push broadband penetration.

Currently, the urban broadband penetration is at 36 million households and rural is at around 3 million connections which needs to go up to 100 million and 153 million households, respectively by 2030, experts said.

In comparison, the US has 92% home broadband penetration, China has 97%, Japan has 84%, and Germany has 82%. Financial Express