Driven by the demand for high-speed Internet access, especially among home users, globally the broadband subscriber base has been growing at an impressive pace for the past four years. According to an International Telecommunications Union (ITU) report on broadband, released in mid-September 2003, broadband subscribers worldwide grew by 72 percent in 2002 to approximately 63 million. South Korea leads the way in broadband penetration, with around 21 broadband subscribers for every 100 inhabitants. Hong Kong (China) with nearly 15 subscribers per 100 inhabitants and Canada with about 11 subscribers per 100 inhabitants rank second and third respectively. 

Two technologies have played an important role in this impressive growth—digital-subscriber line (DSL) and cable modem. Fiber-optic based technologies like fiber-to-the-home (FTTH) and wireless technologies like 802.11b are also used, but are yet to gain mainstream acceptance. 

DSL Leads the Pack
DSL is already acknowledged as the best technology for homes that already have a copper line. It can facilitate both voice and data services over copper using different frequencies. Another advantage is that users get dedicated bandwidth that does not vary with the number of subscribers in the area as in the case of cable and wireless networks. “The best way to deploy broadband is by using existing infrastructure,” Ruchir Godura, country manager and director, South Asia operations, UTStarcom, emphasizes . 

However, Harish M, a business-development manager with Texas Instruments, feels that even though DSL is the best approach, there are issues with the last mile of copper in countries like India. “There are too many joints on the loop that comes to the home. Also, the copper quality in terms of diameter and age is not good,’’ he says.

Godura disagrees that there are quality issues with the last-mile copper that make it unsuitable for DSL. “We are doing a pilot project with MTNL in Delhi and the results have been impressive,’’ he told Voice&Data. MTNL has deployed ADSL lines in the south Delhi locality of Okhla on a trial basis with the loop extending up to 4 km from the central office. Godura is pretty confident about the market potential of DSL in India and expects significant DSL deployments very soon. 

A number of recent developments both on the technology and the price front makes DSL the most attractive option for operators. Interestingly, Asia has not only been on the forefront of service deployment, but also on the DSL technology and equipment-manufacturing front. For instance, the Texas Instruments AR7 (launched in April 2003) is said to be the industry’s most integrated ADSL router on a single piece of silicon. It was developed completely at TI’s India base in Bangalore. 

Technology apart, Asia-based vendors make the most advanced and cost-effective DSL equipment in the world. A recent Gartner report listed two Asian vendors, Huawei at No. 2 and NEC at No. 5, among the top DSLAM companies globally in its second quarter report on global DSLAM shipments. The other leading vendor among the top five, UTStarcom (No. 3), also has a strong Asia focus though headquartered in the US. Asian vendors have gained a lead because of their cost competitiveness. According to Gartner, the average vendor revenue per port dropped from $95.9 (around Rs 4,400) in the first quarter of 2003, to $84 (around Rs 3,800) in the second quarter. Prices are likely to fall further.

Cable Modems Catch up
Cable networks also offer a good opportunity for broadband. And it is not just about data! Today, it is also possible to offer voice over coaxial cable, apart from the regular video. The new DOCSIS2 standard allows for more economical use of the existing bandwidth. Claiming that DOCSIS is the only proven technology for video, voice and data over a single wire, Motorola India’s Kannan Krishnan terms cable modem technology as the most rugged, stable and easiest to roll out. 

Kannan points out that for a successful deployment of cable modem broadband, the telecom operators (who have the Internet bandwidth), the content providers and the multi-service operators (MSOs) must get into a mutually beneficial business alliance. “A tie-up between telcos and cable operators who have the access to homes is a must,’’ Kannan emphasizes.

Motorola, which is the largest cable-modem vendor in the world, is confident that India will soon see telcos tying up with MSOs and last-mile cable operators for offering voice and data services. He also does not discount the possibility of MSOs getting into voice business.

There is no doubt that India’s 40 million cable homes offer a huge broadband opportunity. However, the poor quality of cable infrastructure, the disorganized nature of the cable TV network provider industry and the ongoing conditional access system (CAS) controversy are the existing hurdles.

Fibre: Good for Backbone, Expensive for Last Mile 
Carriers across the world, including India, have been using fiber to build national and international backbone capacities. Fiber is attractive because of its ability to offer unlimited bandwidth on a single strand of fiber. An operator just needs to deploy some improved technology and add more frequencies. However, the cost of terminating equipment needed to light up fiber up to homes is prohibitive today. The concept of using fiber in the last mile, also known as FTTH or fiber-to-the-business (FTTB), is thus often termed an elitist technology. Also, there are no residential killer applications that would require the kind of bandwidth that fiber promises to bring to homes. At most, fiber could become a suitable medium for targeting businesses located close to the fiber backbone networks. 

Wireless: Not Problem-less
Wireless technologies appear to offer an attractive proposition to operators in rural areas with no wireline infrastructure in place. However, these are yet to prove themselves as a worthy last-mile solution. Interoperability problems and lack of uniform standards have proved to be roadblocks in the way of success of fixed wireless technologies like multi-point microwave distribution system (MMDS) and local multi-point distribution system (LMDS). Also, while MMDS operates in a frequency that does not require a line of sight, high frequencies of LMDS do require it. 

The IEEE recently standardized 802.16, commonly known as WiMAX, as a new fixed-wireless standard using point-to-multi-point architecture. According to an ITU report, WiMAX equipment should be able to transmit between 32–56 km with maximum data rates close to 70 Mbps. However, the new standard again is not problem free either—the higher frequencies in the range require line of sight while the lower frequencies have low speeds. However, unlike MMDS and LMDS, WiMAX may not face any interoperability issues. WiMAX is seen as a high-speed wireless backbone, or middle-mile technology, linking distant ISPs to the Internet. Thereafter, WLAN technologies can be used as a last mile.

Whither India?
India does present an increasingly fertile ground for large-scale both fixed line and wireless broadband deployment. There are many reasons to believe this. At the macro level, economic growth has been healthy, leading to an increase in consumer purchasing power. Also, PC and Internet penetration has been growing decently. Moreover, with stiff competition in the bread and butter voice market, telecom operators have begun looking for other incremental source of revenues and broadband surely is an option. What seems to favor operators is that broadband last-mile access equipment and CPE costs have been witnessing a southward trend making them relatively more affordable for a price sensitive market like India. The bottleneck, if any, is the inability of the service providers to hit the right chord in terms of choice of the right technology, right kind of business alliances or service ecosystem and finally, the right price point. Until that happens, broadband services are unlikely to be successful in India.

Ravi Shekhar Pandey