The Indian telecom sector serves the world’s second largest telephone and internet subscriber base (estimated at 500 million in June 2018) and contributed 6.5 per cent to India’s GDP in 2015. Since the last decade, India’s telecom market has witnessed technology transitions such as fixed-line to mobile, 2G to 3G, and 3G to 4G networks, with a roadmap for 5G in the pipeline.
This period has also seen a shift from circuit/packet-switching calling to data-based calls, and enhanced data consumption with deployment of WiFi hotspots and advent of over-the-top (OTT) applications (WhatsApp, etc). Close to 95 per cent subscribers accessing wireless internet with an average monthly data consumption of ~1.6 GB, up from just ~240 MB in 2016, show TRAI reports.
With the country’s internet penetration rate standing at 33 per cent, with only 16 per cent in rural India, and economic activities relying on information and communication technology (ICT) more than ever, the scope for telecom sector’s contribution is colossal.
Reforming the sector
The telecom infrastructure has become an essential backbone of the Indian economy, providing national and international connectivity between consumers, businesses and governments. The Digital India initiative was also well-timed as the country prepares to transition into a new phase of tech-driven development.
In the coming months, the country is expected to experience in-flight internet connectivity, further boosting business and overall economic growth. Considering these aspects, TRAI and DoT are spearheading the transformation of the telecom sector through the National Telecom Policy (NTP), which is under consultation and many reforms are envisaged.
The TRAI’s proposed objectives to the NTP 2018 provides various ICT connectivity and accessibility targets to ensure that India breaks into the top 50 nations by 2022. While these targets would provide the must-needed access to all and impetus for ICT growth, they seem to be vague and inadequate for ensuring high performance and quality services.
While the prices to access telecom services have come down, coupled with increase in internet speeds, has this resulted in reduction for consumer grievances or enhancement of consumer satisfactions? Perhaps, this is debatable as both Quality of Service (QoS) and Quality of Experience (QoE) have remained the major pain-points for Indian telecom users even today.
In fact, both QoS and QoE have suffered over the years due to multiple challenges such as tariff-oriented competition, dated definition of minimum broadband speed (currently at 512 kpbs), spectrum capacity and sub-optimal utilisation, incompatible devices and equipment, barriers in deployment of telecom equipment and towers, India’s diverse topography, etc.
Also, the sector is burdened with various fiscal obligations such as spectrum high cost and usage charges, licensing, USOF contribution, etc. Intense and irrational tariff wars have further dented the telecom sector’s fiscal performance, leading to consolidation and lower revenues. With only four pan-India operators left in the market, it is now imperative to streamline the sector towards national interest.
The TRAI and DoT must frame the NTP as a perfect example of monitoring the sector with light-touch regulations. The NTP 2018 targets must be incentivised by linking them to QoS+QoE so that operators make consistent efforts to improve service performance.
These incentives may be in the form of reduced interference, relaxed regulations and/or fiscal obligations, so that operators feel light and are able to grow and contribute in constant sector evolution with much-needed verve and zest. A regular check on anti-competitive practices and adequate fund allocation from USOF for promoting PPP models are other cross-cutting incentives that would hugely benefit the sector, often associated to other common utility services.
The existing monitoring mechanism of QoS and QoE parameters needs an urgent revamp so that performance testing is conducted under standard conditions and harmonised results are obtained at any point of time. Initiatives such as the TRAI’s MySpeed app and data analytics, should be promoted to forge a transparent and accountable mechanism for consumers and industry.
This would also require a rigorous exercise of creating standards and methodologies for testing network performance so as to suit the present and future mechanisms. This is achievable if operators are encouraged to disclose their actual network-testing and performance-related information in the public domain. The developer community may access this to build appropriate APIs to support the operators’ and regulator’s efforts in this endeavour.
Our initiative on labelling broadband services also advocates for information disclosure through standard tool that users may use to make informed decisions and also compare existing broadband services on various parameters and benchmarks. Such a tool may also help operators to become more quality conscious.
The Nokia MBit Report of 2018 suggests that with booming data consumption, there is a need to decentralise networks towards the source of data generation, which would help reduce latency of application and enhance user experience. Hence, with the adoption of 5G technologies, as seen globally, Indian operators would be able to reduce churn and increase market share, resulting in higher ARPUs.
A recent 5G trail in Manesar, Gurugram by Bharti Airtel and Huawei (under test conditions) clocked a data speed of more than 3gbps, much higher than the dismal national average of 6mbps on 4G network. Hence, the NTP 2018 must promote such emerging technologies and development low-cost, yet efficient, telecom equipment to enhance QoS+QoE performance and encourage a value-driven service delivery for users.
Thus, the NTP 2018 is an opportunity for the telecom ecosystem to create a solid platform that not only reduces the digital divide, but also improves the quality and experience of services through incentives and a harmonised mechanism. By reducing subjectivity and minimum governance approach, the TRAI and DoT must work in tandem with operators, developer community, academicians and civil society, to provide inclusive benefit to users, industry and the nation through the NTP 2018.
The writer works as a policy analyst with CUTS International