THE number of broadband Internet subscribers in the country is likely to fall sharply if telecom regulator Telecom Regulatory Authority of India’s ( Trai) move to redefine broadband as a connection with a minimum speed of two mbps ( megabit per second) takes shape. Most operators are unlikely to offer the higher speed to customers immediately, and would probably opt to reclassify subscribers instead, industry sources said.
India currently has a little over 10 lakh broadband Internet subscribers. Trai has a target of reaching one crore subscribers by next year. At the moment, the industry appears to be moving towards upgrading customers from 256 kbps to 512 kbps. Trai’s proposed move was triggered by the idea of offering higher speed to consumers and bringing broadband services at par with global standards.
Indicating the direction in which Internet service providers ( ISPs) are likely to move, leading ISP Airtel slashed the prices of its broadband services on Tuesday. The company launched innovative schemes under which customers can avail one Mbps speed at Rs 1,699 and 512 Kbps speed at Rs 1,099 as well and additional free value- added services ( VAS) bundles worth up to Rs 500 every month.
Said Vikas Singh, chief marketing officer, Telemedia Services, Bharti Airtel, “ As per our internal research, most consumers were looking at increased data usages and higher speeds. A good economy package fits the bill.” Airtel’s broadband services business has been growing at eight per cent. However, the broadband penetration in the country stands at a dismal 11 lakh and with wireless being touted as the future technology in Internet connectivity, its usage is likely to be restricted to urban centres.
Naveen Mishra, lead analyst ( mobile handsets and telecom services practice), IDC India, said, “ As the growth in broadband subscribers in India has failed to meet expectations over the past few years, the move by Airtel to lower its broadband tariffs can be seen in the light of the overall industry efforts to grow the market.” Added Harit Shah, telecom analyst, Angel Research, “ Wireless is the future technology in Internet connectivity across the country.
Broadband will be more of an urban phenomenon. In my opinion, now very few players will actually spend on enhancing their broadband services further.” Another problem irking some ISPs is the move from 256 kbps to two mbps at one stroke. An industry insider said, “ At this moment, it is just not feasible to upgrade from 256 kbps to two mbps in one go. Trai should understand and the definition should be revised. We should be asked to move in stages. To begin with, it should be a move from 256 kbps to 512kbps. A direct shift will be quite expensive.” Trai has also said that other countries are already touching speeds of 20 Mbps and more.
India has to catch up with them.
Trai’s move is, however, supported by the WiMax industry.
Earlier, Trai had recommended that tariffs be cut massively to make broadband attractive to the masses. At present, a 100 kbps line costs around $ 16 in India, compared to Korea where it is less than a dollar. Even in China it is $ 3. If the recommendations are accepted, this will be cut down to less than $ 8. Moreover, Trai has tried to make a case for broadband and Internet by linking their expansion to the growth of the country’s GDP.