The Hindu Business Line : Communicate more, commute less

CRUDE oil prices have crossed $70 a barrel from $35 two years ago, and LNG (liquefied natural gas) at $10 per MMBTU is double that of last year. These are the prime sources of energy for power generation and transportation. The latest hike in petrol and diesel prices may only be the beginning and more such hikes are sure to come if international prices of crude oil do not soften. Nearly two-thirds of the country's oil requirements are being met through imports. In term of value, oil is the largest component of the import bill, and this can only increase because of the rising demand.

Despite rising fuel prices, the automobile sector is booming. For instance, in Hyderabad, which has a population of about 50 lakh, there are already 15 lakh vehicles. Banks are vying with one another to offer vehicle loans, especially to those in the information technology (IT) sector. As the automobile population rises, thanks to easy finance, roads will become congested with vehicles no matter the better roads, the flyovers and the under-passes.

Automobiles are one of the largest consumers of oil-based energy, and any increase in their numbers will further push up the import bill, pollution and global warming.

In China, vehicular population is increasing even faster than India's. If the automobile ratio (number of cars per 1000 people) in China and India rises to levels in the developed countries, both the economies will take a hit unless, of course, new energy sources are found.

Vehicles are largely used for commuting to work. Can work-related travel be reduced? Yes, with the help of telecommunications. The energy contained in one teaspoonful (1cc) of petrol can power five minutes of telephone conversation over a distance of up to 50 km.

The price advantage of telephony is 60 times that of commuting; and telecommunications is becoming cheaper by the day. In terms of time also, the advantage of telephony is 36 times more. If a telephonic conversation can substitute physical meeting, the savings involved will be substantial.

Connecting places by roads is expensive. Laying a third-class road will cost about Rs 1 crore a km, and a four-lane national highway, about Rs 5 crore a km. Whereas, laying optical fibre cable costs less than Rs 3 lakh per km — that is, 33 times cheaper than building a road.

Once villages and towns are connected by optical fibre cables, the bandwidth (comparable with the carriageway) is almost limitless, where not only telephony but also video conferencing will be possible. When classrooms in different locations are connected by the optical fibre system, a lecture delivered in one place can be heard and seen at different locations. Students need not bus from homes to colleges and schools.

Again, at the government level, instead of organising meetings of Chief Ministers in New Delhi, the same can be done through video conferencing. The cost saving involved will be huge.

The Internet is fast becoming a substitute for libraries. When books are digitised and uploaded on the Web, there is no limit to the number of people who can access them — the power of computers and IT, that is.

India is becoming the largest supplier of software services and manpower for business process outsourcing. The US and other developed countries are farming out the information and knowledge-based work to India, as this works out to only about a fifth of what it would otherwise have cost them.

If the US can outsource work to Hyderabad, thanks to the network of telecommunications satellites and undersea cables, why cannot Hyderabad, in turn, outsource the work to a village where it can be performed at, say, a third of the cost?

Satyam Computer Services, for instance, supports the Byraju Foundation, and is operating in 140 villages in the West and East Godavari, Krishna, Khammam and Guntur districts. Satyam recruits unemployed graduates, trains them in English and imparts computer skills. It has taken broadband telecom connection to these villages and is engaging graduates there to do the company's work. These graduates are proving themselves as good as those in Hyderabad.

Work can be taken to the workers rather than make them move to cities and other countries.

All this is happening because of optical fibre-based communications becoming extensive and inexpensive.

De-monopolisation of the telecom sector, entry of the private sector and competition are transforming the country's telecommunications into an electronic-photonic information infrastructure for voice, images, text and, of course, data.

This is comparable to the infrastructure of roadways, railways, seaways and airways for storage and movement of masses and goods.

The information infrastructure can be made even more affordable by removing unwarranted imposts such as revenue share, entry fees, service tax (on telephone bills) and access deficit and interconnection usage charges on private telephone companies to keep state-owned BSNL afloat.

That BSNL made a profit of about Rs 6,500 crore on a revenue of about Rs 35,000 crore in 2004-05 is indicative of how it is profiting from government ownership.

To ensure that government ownership is not misused, to the disadvantage of competing private telephone companies and their subscribers, BSNL's administrative control should be transferred from the Communications Ministry to, say, the Commerce Ministry.

However, the proposal of the Communications Minister, Mr Dayanidhi Maran, to treat the whole country as one local call area, by abolishing STD/trunk call charges dependent on distance, is bold and reflective of the technological advances. Postal rates are not distance-dependent; neither should telephone charges be.

(The author, a CMD of VSNL, was Information Technology Advisor to the Andhra Pradesh Government.)

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