Looking Beyond Cities

As part of the SAARC CEOConclave, organized by VOICE&DATA in Kathmandu, a
discussion titled “Technology Enabling Beyond Urban Expansion” was held to
discuss technological issues in taking telecom beyond urban areas, efforts made
by the operators in getting last mile connectivity, and the future roadmap.

Romal Shetty, executive director, Advisory Services, KPMG, was the moderator.
He kept the panelists focused on the real issues and came out with a guideline
at the end of the discussion.

The discussion started with AK Srivastava, GM, MTNL, who emphasized on taking
a similar approach in both the rural and urban areas. Srivastava said that there
should not be a differentiation between technology in rural and urban areas.
It's just a case of maturity level. The rural market has the same requirements
as that in the urban market. The urban market is more mature but that doesn't
mean rural areas are not information-friendly. The rural market has not been
explored till date and the urban market is reaching the saturation point. The
gap between the rural and the urban market has widened over the time and this is
one of the reasons why operators are suspicious of their approach in the rural
battlefield.

For connectivity, Srivastava suggested optical fiber as the best possible
option. “Putting the copper wire is not a good idea. In the long run, optical
fiber will prove cost effective,” he told the operators. “If you offer good
services in rural areas, their status will rise, and, in return, your ARPU will
also rise. We should not forget the lower ARPUs in urban areas in the initial
days,” he added.

BV Raman, country head, CDMA Development Group, also agreed with Srivastava.
“There is a major disparity between rural and urban teledensity. In rural areas,
reaching last mile connectivity is a challenge and to reduce the digital divide,
the wireless solution is a must,” says Raman. “The chosen technology should be
evolutionary rather than revolutionary,” he added while talking about rural
technology requirement. The technology adopted should offer minimal disruption
and minimal cost. Talking about the role of policymakers, he said that a 3G
policy should come out very soon.

Panel discussion on 'Technologies Enabling beyond Urban Expansion' was attended by (from L-R): Ajay Ranjan Mishra, head, Business Development, Nokia Siemens; Nizamudding Choudhary, chief project co-ordinator, Dhaka Telephone Company; DP Vaidya, president, VSAT Association; Pradeep Kumar, executive director, Railtel; Romal Shetty, executive director, KPMG; BV Raman, country head, CDMA Development Group; V Ravi Shankar, CEO, VSNL Lanka; Shyamal Banerjee, director, Corporate Business, Texas Instruments; Sirish Prabhu, head, IT, TTML; and AK Srivastava, GM, MTNL

Real Problems

Shyamal Banerjee, director, Corporate Business, Texas Instruments, put emphasis
on real problems in rural areas and advised operators to be clear about the
service they want to offer. Problems in the rural market are not related to
high-end technologies. “The real problem is very small, like power and
transportation. Any offerings from the operator's side should justify the cause.
It should have the content for their healthcare, livelihood, education, and
news,” said Banerjee.

“The operators should design products according to the requirements of a
particular area. We should not forget that there is a $10,000 crore USO fund
waiting to be invested in India. The operators should come up with a concrete
plan to utilize it in the right manner,” said Ravi Shankar, CEO of VSNL Lanka,
who jumped into the discussion at this point and urged the society to have a
commitment to serve rural areas.

Practical Concerns

DP Vaidya, president, VSAT Association, took the operators' perspective and
raised some practical concerns. He defended the operators on concentrating more
on the urban market. “Where returns are high, automatically the focus will be
high. The operators are not to blame. After all they are doing business and they
need good return to survive,” said Vaidya.

Talking on different technologies for rural areas, Vaidya said, “Each
technology is complementary. It has to go side-by-side. VSAT has tremendous
advantages when it comes to reaching remote areas.” Vaidya presented the example
of the Karnataka government, saying that Karnataka has digitized all their land
records, even birth and death records. They are using a shared platform. He also
appealed to the regulators to look into the satellite cost and other aspects.

Facilitaing Growth

On the issue of technology, Ajay Ranjan Mishra, head, Business Development,
Nokia Siemens Network, said, “Technology is like a vehicle which facilitates
growth. It's not about the total cost of ownership. The government, NGOs, and
private players need to come together to get it going.” He also drew attention
towards the need for right content focused on the rural market. The power supply
problem in rural areas stood as a major concern in the SAARC region and that
took them on a common platform to discuss viable solutions. Due to similar
geographical conditions and growth, the operators in the SAARC region face
similar situation while dealing with it.

Power Problem

Talking about the problem of power, Pradeep Kumar, executive director,
Network Technology Planning, RailTel, said that disrupted power supply is one
reason that has kept rural areas far behind the urban growth in terms of
communication. Bimal Acharya, senior engineer, Nepal Telecom, asked the
panelists how to overcome power shortage.

All attention

Answering Acharya's question, Ajay Ranjan informed that Nokia Siemens is
constantly working to develop alternative sources of energy, which will be of
great help in rural areas and would be cost effective too. “In Bangladesh we
face power crunch. Therefore, we have to look for back-up battery. At places
where the power requirement is low, solar energy is an option,” said Nizamuddin
Choudhary, chief project coordinator, Dhaka Telephone. He further said that
managing BTS requires more power and in rural areas it becomes a daunting task
for the operator. He advocated for VSAT, saying, “VSAT utilizes the technology
very effectively and it's also very cost effective. It only requires power at
the customer's premises.”

Choudhary informed the audience that his company, Dhaka Telephone, launched
its services in July 2006 and has been granted a nationwide license. Dhaka
Telephone uses the CDMA technology for its services. The maintenance of copper
wire was becoming a challenge for the company due to the geographical
constraints and higher cost involved. So, the company started rolling out
optical fibers in different regions. Choudhary asked operators to focus more on
voice for the rural market rather than worrying about the right content. Voice
is the basic requirement and a complete growth can happen only when voice is
available everywhere. Dhaka Telephone has come up with a village network
solution, which is quite cheap and is proving beneficial for them.

Future Technologies

Talking about future technologies, Choudhary said, “Considering the rural
geography, 3G is definitely going to help, but the cost of implementation is
very high at present. The operator will have to take a call on this, with active
support from regulatory authorities.” According to him, GSM will still play a
bigger role in rural penetration.

On the whole, the discussion highlighted some common concerns of all SAARC
operators regarding technology for rural deployment. The VSAT technology found
favors with many operators for last mile connectivity. ARPU was again a major
issue. Sirish Prabhu, head, IT, TTML, suggested that apart from voice, operators
should release some killer applications according to the rural needs and it will
ensure better ARPU in the long run. The entire panel, however, agreed that
development of voice in the rural area should be the prime focus of operators.

Kumar Anshuman