Shantanu Consul, Administrator, Universal Service Obligation Fund

Advanced Search

Feedback

Reader's Poll

Any data to show

Teledata

Mobile Subscribers Yearwise comparision

Shantanu Consul, Administrator, Universal Service Obligation Fund

October 15, 2007

Be the first to comment!

With 600,000 villages in India, a substantial proportion of the untapped telecom subscriber potential resides in the rural areas. To increase rural teledensity and ensure that every village in the country has access to telecom services by 2010, the government is working with service providers to facilitate the rollout of networks and services. tele.net talks to Shantanu Consul, administrator, Universal Service Obligation (USO) Fund, about taking telecom to the masses. Excerpts...

What are the targets for increasing rural teledensity?

The target is one phone per two rural households by the year 2010, which would translate into a rural teledensity of 10 per cent. Rural penetration should also be gauged in terms of coverage. While it is not easy to estimate the coverage, I would say that in the rural areas it should currently be in the range of 50 per cent. The target would be to see that every village in India is covered by 2010.

What, according to you, are the key drivers for achieving high penetration rates in the rural areas?

Infrastructure in the form of towers should be created rapidly to facilitate coverage in these regions. It is very difficult to estimate the number of users who can be serviced by a single tower. It is a function of the economy of the area. The important factor here is that the signals should reach every village. A comprehensive optic fibre cable (OFC) network will also help increase rural penetration. Improved power supply is another key factor as depending on conventional electricity is not a very reliable option given the power shortage in these regions. For this reason, the possibility of utilising non-conventional energy is being explored. For instance, Idea Cellular and Ericsson are using biofuels in rural areas. Therefore, other means, be it solar or hybrid, should be used. We will consider these solutions and support such moves as these would improve reliability and functioning of the rural telecom networks. Finally, the availability of low-cost handsets coupled with low tariffs, which are a result of competition in this field, will result in high penetration in these regions.

What are the government's initiatives for increasing rural teledensity?

We are trying to keep in constant touch with service providers, and are trying to launch schemes and projects that will meet their requirements and encourage them to go into the rural areas. The first phase of mobile towers has already been tendered, the second phase is being planned, and we will be talking to service providers shortly. Further, we are planning for rural broadband and are trying to improve the OFC network that lies between the block headquarters and the district headquarters. The provision of public access to telephony is in its final stages.

With the dismal broadband penetration rates in the rural areas, is it possible to achieve the ambitious broadband targets set by the government?

This covers urban areas as well. I believe things are improving dramatically. For instance, in mobile telephony, once the infrastructure is in place and the major issues are sorted out, there will also be a commensurate growth in broadband connections.

What are some of the initiatives that have been taken on this front?

A scheme to support the extension of broadband into the villages is almost ready. Discussions with the stakeholders are under way. However, it is unlikely that we will come out with a tender soon. We are ready but there are certain issues regarding allocation of spectrum that have a bearing on what we are trying to do. So, if the major decision regarding spectrum allocation for broadband access is going to take some time, we need to take a look at alternatives, to see what spectrum is delicensed, and whether what has already been allotted can be used. It should be possible to launch the scheme as soon as the decision regarding spectrum allocation is taken.

Action will also be taken to improve the OFC network and to encourage shared backhaul. The Department of Information Technology has launched a scheme to set up 100,000 common service centres in the rural areas and has extended financial support for providing broadband connectivity in selected areas. For the broadband initiative to succeed, coordination between the Government of India and the state governments, the service providers and NGOs is essential. Content development in the local language is crucial for the success of this venture.

What are the challenges associated with increasing the teledensity in semi-urban and rural geographies?

There are many challenges associated with increasing the teledensity in these regions. I have just come back from the Northeast. In the Northeast, and this is true for other parts of the country as well, the poor road networks, inadequate power supply and difficult terrain make it difficult to set up infrastructure. It is difficult to move diesel to these areas. Laying OFC networks is impossible because of the difficult topography in many of these places. The coverage of a tower is much less than what it would be in other areas, so more towers are required. The low income levels in these areas are another stumbling block. These are some of the key issues that need to be addressed.

Which rural areas have particularly low teledensity?

The Northeast, the hilly parts of Jammu & Kashmir, Himachal Pradesh and Uttarakhand, and the forest areas of Orissa, Jharkhand and Chhattisgarh have low penetration, difficult terrain and sparse population. Apart from a village public telephone in some villages, there is no real connectivity in some of these areas. However, once the basic infrastructure is in place, these villages will also be covered.

What is your view on the concept of rural service providers?

There are certain licensing issues that need to be resolved. Then, we also have to wait and see if the regular licensees are able to cover all these areas. If they demonstrate that there are certain areas that they are reluctant to cover, then there will definitely be a case for others to operate in those areas.

How has private sector participation in the rural telephony segment increased over the last few years? What is the likely trend in this area given the current focus on rural telephony?

Private sector participation has increased rapidly. The enthusiasm of private sector companies to provide services in the rural areas is clearly visible. I am hopeful that this trend will continue. The response to the shared infrastructure mobile infrastructure scheme has been overwhelming. The USO Fund administration anticipates that most telecom companies will continue to extend their network in the rural areas. Sharing, which will reduce capex, will become the accepted practice.

What is the current status of the bidding process of the USO Fund?

Bidding for the first phase of the shared rural mobile infrastructure scheme is over. Infrastructure providers are in the process of giving final shape to the actual locations and in some areas work on the erection of towers has started. Now we have to come out with a tender for broadband and whatever methodology we are planning to follow for the second phase of rural mobile telephony.

The towers are supposed to come up in two phases. In the first phase, the total number of towers was 7,871. I think we will be looking at something in the range of 5,000-6,000 towers by May next year.

What is the current status of disbursals from the USO Fund?

We spend what is allocated to us. Till now, whatever has been allocated to us every year has been utilised. For this fiscal year, Rs 18 billion has been allocated and the finance ministry has assured us that it will consider giving more if the need arises.

What is the extent of the gains that are to be had from infrastructure sharing?

We are a great supporter of infrastructure sharing and we think that this is the only way to make a foray into the rural and remote areas where the number of customers is limited, the cost of setting up infrastructure is high because of difficult terrain, and operating expenses possibly higher than in other areas. It does not make economic sense for each service provider to establish its own infrastructure in the rural areas. In order to keep capex down so that services can be provided at low tariffs, infrastructure sharing is the only way out. Sharing of passive infrastructure is already becoming the norm. Recommendations for sharing active infrastructure have already been made by the Telecom Regulatory Authority of India and are being considered by the Department of Telecommunications. Currently, we are sharing only passive infrastructure but technological developments are going to make it possible to share active infrastructure like antennas, backhaul, etc. With suitable policy interventions, sharing of active infrastructure will soon become a reality.