R Srinivasan

The real cost of the spectrum scam

R. SRINIVASAN | Updated on November 16, 2017

Fibre-based connectivity offers the opportunity to unlock the potential at the bottom of the pyramid.


Decision makers appear to think terrestrial wireless is the only way to go. We are in real danger of missing the bus on alternative technologies for connectivity.

India managed to leapfrog several generations in technology and connectivity thanks to the mobile telephony revolution. But unfortunately, technology has a habit of not allowing one to rest on one's laurels and soak in the glory.

Thanks to the heat and dust of the spectrum scam, there is a real danger of the momentum generated by the explosive expansion of the mobile telephony sector getting dissipated in endless rounds of legal wrangling, bureaucratic obfuscation and plain political dithering.

There have been two fall-outs of the spectrum scam. One is the completely skewed perceived valuations of the so called “national resources', which is rapidly driving pragmatism out of the window — while pushing the costs of basic essentials, such as energy or communication, rapidly beyond what is manageable for a country like ours.

The second fall-out is more insidious and damaging in the long term. The policy paralysis which has gripped governance at all levels means that critical decisions — including decisions that need to be taken today in order to maintain India's growth momentum and competitive ability tomorrow — are simply not being taken.

optic-fibre connectivity

Telecom itself offers a good example of both. Witness the chaos unleashed by the spectrum scam and its aftermath — the cancellation of as many as 122 licences, the decision of many serious telecom players to delay or defer their engagement in India and the virtual stoppage of all fresh investment in the sector, even by those in no danger of losing their existing licences. Spectrum has figured so much larger than life in the public sphere that even policymakers and decision-makers who ought to know better, appear to be labouring under the illusion that terrestrial wireless (space-based wireless unfortunately got derailed by the Devas imbroglio) is the only way to go.

This means that we are in real danger of missing the bus on alternative technologies for connectivity. Like fibre optics, for instance. Oh, we have a mission for optic-fibre connectivity. There is a Rs 20,000-crore plan to bring broadband connectivity to the panchayat level. There is even a national optic-fibre network in place.

But there is no real movement forward in actually extending the linkages from the backbone to the hinterland. Even where some linkages have been established, usage is abysmal — neither service providers nor consumers are plugged in.

This is a great pity. Fibre-based connectivity offers the opportunity to unlock the potential at the bottom of the pyramid, by multiplying manifold the quality and speed of connectivity.

Even the best paying urban broadband consumer today does not enjoy Internet connectivity at speeds in excess of 5 mbps, full Internet protocol cable television access, plus voice telephony, all on the same line.

Yet, using domestically developed technology and locally manufactured equipment — equipment manufactured at home at costs lower than the cheapest Chinese import — this is already being enjoyed by actual customers in one test location in Rajasthan, at one-third the cost to the consumer of a comparable service.

Yet, this dramatic achievement has remained unsung, and is not showing any signs of being rolled out nationally anytime soon. The lessons of history, and of the transformation wrought in the countryside by the first connectivity revolution of the 1980s and 1990s, have clearly, already been forgotten.

At ‘lightning' speed

The trouble with being a young country in terms of population is that most of your citizens are too young to remember many things — including stuff that is important to remember. Like what it would have been like not to take a simple thing like communicating with anybody you want, for granted.

Since more than half the population is under the age of 25, a majority of the people simply do not know what life was like without basic telecom connectivity. When all your adult life has been spent taking mobile telephony for granted, it does become difficult to imagine how things would have been before it.

Thirty years ago, it was more a truism than a cliché that half the country was waiting for a telephone, while the other half was waiting for a dial tone. The average waiting time for a new telephone connection was nearly a decade. The average waiting time for a trunk call was hours, and sometimes days. Forget villages — even most district headquarters had a handful of telephone lines outside the government. There were no public call offices outside of the metros and a few state capitals.

Subscriber Trunk Dialling was a rare new beast. Most customers felt it was simply too expensive, and not all that necessary, to have that facility ‘unlocked' on their telephone connections — if they had a connection in the first place, that is.

The only option for those needing to communicate on the go was to reach the nearest telegraph office (another extinct species now) and book a ‘lightning' call. And wait. Just because it was classified as ‘lightning' did not mean that the call travelled at that speed. After all, even major towns had a handful of ‘trunk' lines connecting their local network with the rest of the world.

C-DOT — on the dot

Today, India has nearly three quarters of a billion phone connections, an overwhelming majority of it mobile. You can seamlessly dial (network and signal permitting) any corner of the globe from any corner of this continent-sized country. And all this has happened — and could happen — because of the telecommunication revolution unleashed by the Centre for Development of Telematics, or C-DOT, three decades ago.

Amazingly, C-DOT was — and remains — a 100 per cent government initiative. The difference was, back when it started in 1984, it had political backing.

That made the crucial difference when it came to transferring C-DOT's rural automated exchanges and larger main automatic exchanges into the shop floor from the lab, and from factories into actual deployment. At one point, about half the fixed lines in the country were running on C-DOT technology.

The rest, as they say, is history. This not only laid the base for modern telecom manufacture in India but set in motion the market forces which unlocked demand, and led to the second telecom revolution.

But that is on hindsight. In 1989, when Rajiv Gandhi lost the elections, a witch-hunt was launched, which ended up throwing out the baby with the bathwater.

C-DOT was, and still is a remarkable institution. It was always much larger than the larger-than-life Sam Pitroda, its founder.

Today, it has managed to re-invent itself as a cutting edge technology developer, which has come up with proven technology for transforming the communications landscape — at globally competitive costs.

Others have recognised — and acted — upon the potential of fibre-optic connectivity. From China, which has actually made a fibre-optic network a defence priority (outlined in its White Paper on Defence 2010) to Australia, which is spending $40 billion — ten times what India has committed — to wiring up every home in Australia with fibre.

Global telecom majors are also beating a path to C-DOT's door, looking for ways to access their technology. But the people who should be most interested continue to be serenely indifferent, focused more on either profiting from the spectrum windfall or avoiding the attached controversy.

That is the real cost of the spectrum scam.

> Raghavan.s@thehindu.co.in

Published on May 16, 2012

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