Rural folks living in six lakh remote villages across the country will soon get high speed broadband services for just Rs 99 a month.

Villagers won't have to pay any upfront cost for taking a connection and also get the consumer premise equipment free of cost.

This is being made possible because the Department of Telecom has finalised a scheme whereby telecom operators will be given money to roll out wireless broadband network in villages.

Four plans

In return for the subsidy, operators will have to offer the tariffs fixed by the DoT and minimum speeds of 512 kbps.

The DoT has decided on four tariff plans, the cheapest one being Rs 99 a month with 500 Mb of free download (enough for watching streaming video for 8 hours or download 100 songs). For higher data usage, consumers can opt for Rs 400 a month bundled with 10 GB free download. For Government institutions, there is an unlimited download plan for Rs 800 a month.

The project will be funded by the Universal Services Obligation (USO) which a corpus of nearly Rs 20,000 crore.

For providing the subsidy, DoT will select one private operator in each circle through a bidding process.

Telecom companies with unified access licence or Internet service licence will be allowed to bid.

According to the draft tender document, the operators which agree to cover all the villages in a circle at the lowest cost will be given the contract. BSNL will also be given the same amount by default.

Once the operator is selected it will be responsible for installing the required network and providing modems, dongles and devices to consumers.

Operators are free to choose the technology but will have to roll out services in 10 per cent the targeted districts within 12 months and complete coverage within 24 months.

Broadband wireless

Operators will get subsidy in a phased manner over 8 years in addition to Rs 2,000 for each consumer premise equipment.

The broadband project has been in the making for the past five years but could not be implemented because of the delays in auctioning for broadband wireless spectrum. Now that the spectrum has been sold, the DoT has decided to push through with the project. The final tender document is expected to be released in the first week of May while the bids are expected to be opened in the latter half of June.

Broadband growth rate in India has been sluggish compared to the uptake in mobile usage. While there are nearly 14-15 million new mobile subscribers every month, only a few lakh new broadband connections are being added each month. The Government had set a target of reaching 20 million broadband subscribers by the end of 2010 but fell short by 50 per cent.

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