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Tele Data

Mobile Subscribers Yearwise comparision

Neeraj Arora, Director and Lead, IBSG, Service Provider, Cisco India and SAARC

November 22, 2012

Neeraj Arora, Director and Lead, IBSG, S...
Despite efforts by the government and other stakeholders to push broadband penetration in the country, the segment has witnessed negligible growth.

To address this issue, the government has launched several initiatives, such as the national optical fibre network (NOFN) project, which aims to provide broadband connectivity to 2,50,000 village panchayats. Moreover, industry analysts are of the opinion that mobile internet is set to witness tremendous growth, keeping in mind the emergence of 3G and 4G and low cost mobile devices.

In an interview with, Neeraj Arora, director and lead, IBSG, service provider, Cisco India and SAARC discusses the opportunities and challenges the Indian broadband segment offers, as well as Cisco’s plans to leverage the potential business opportunities this growth may entail. Excerpts…

What are the key challenges faced by the Indian broadband segment?

Today, a country’s socio-economic development and inclusive growth is increasingly dependent on innovations in core sectors such as financial services, education, healthcare, infrastructure, eGovernance and communications. Broadband, like power, water and roads, has been proven to be an essential enabler for all these sectors, and indeed the overall economic growth. However, in India, broadband penetration (more than 256 kbps speed) is lesser than 1 per cent of the total population. This is one of the lowest in the world as compared to other economies like Russia (12 per cent), Brazil (7.5 per cent) and China (11 per cent).

Some of the challenges that impacted broadband adoption in India include the lack of affordable data plans and reliable broadband services, a fragmented group of industry operators, lack of a profitable business case for network infrastructure (particularly in semi-urban and rural areas), absence of local loop unbundling, expensive smartphones and lack of compelling vernacular content and applications in the areas of healthcare, education and agriculture.

However, critical fundamentals which are crucial for penetration of broadband in the country seem to be falling in place. These include initiatives such as the Government of India’s’ National Broadband Network program that would provide connectivity to 250,000 village panchayats and in-turn help close the digital divide, the emergence of 3G and 4G and planned rollouts of Wi-Fi networks from the operators and cable digitisation and the foreign direct investment (FDI) mandate (74 per cent FDI for broadcast carriage services providers) that would lead to not only more immersive TV experiences, but also enable investments in cable broadband infrastructure.

Also, there have been significant efforts from the government to launch eGovernence programs and digitise records, besides increasing availability of local content and applications.

What is the current mix of wireline and mobile broadband in the country?  Going forward, which platform is likely to become dominant for broadband usage?

In India, fixed digital subscriber line (DSL) constitutes more than 85 per cent of the total broadband subscriber base, whereas mobile broadband accounts for less than 3 per cent. While DSL is the most common evolution path in other countries, however, India does not have a large enough base of wired households ready to upgrade. Cable broadband has a large base of subscribers (>80 million); therefore, multiple system operators will play a significant role in achieving last mile broadband connectivity.

Mobile broadband has also started gaining significant traction. The introduction of 3G and 4G, reduced data rates, affordable smartphones and tablets (at less than $50) are expected to further drive mobile broadband. Using 3G and 4G, subscribers would be able to access services, such as online standard definition (SD) and high definition (HD) videos, mEducation, mHealthcare and other interactive services (like gaming), easily, anytime, anywhere and on any device.

What has been the impact of launch of next generation technologies in the broadband space?

A recent World Bank study showed that for every 10 per cent increase in broadband services penetration, there is an increase in GDP growth of 1.4 per cent. India, with its low current broadband penetration, is primed to significantly benefit from enhanced investments in networks and broadband adoption.

While large scale impact of some of these technologies would unfold in the next few years, emerging areas of impact enabled by broadband connectivity, particularly in remote rural areas and small towns include access to infotainment, opportunity and infrastructure.

1. Infotainment access ­ immediate access to information and entertainment (ranging from weather to financial services, e-government service, such as land records and birth/death registration), best practices sharing such as cost of produce/agricultural techniques for the agricultural community) and entertainment including services like IPTV and local radio content.

2. Opportunity access ­ access to instruction/educational opportunities, especially for students in remote and rural areas, as well as better job opportunities, through language skill and job enhancements programs. This could in turn help plug and reverse the brain-drain from village to cities.

3. Infrastructure access ­ affordable and timely access to critical needs like healthcare through telemedicine), utility services covering services like rail tickets, electricity/telephone bill payments) and enterprise/server message block (SMB) productivity improvement through automation

These three areas would help enhance India’s competitiveness and foster innovation-led socially inclusive growth.

How has the broadband application ecosystem evolved? Which are the promising applications in this segment, especially with broadband wireless access (BWA) being launched?

Most of the broadband applications have been centered on basic connectivity and features (email, voice over internet protocol (IP), transactions like travel/train bookings, ecommerce). However, this is going to get transformed into more interactive, immersive and intelligent cloud applications.

Technologies like BWA would enable delivery of advanced consumer and business mobility experiences. These experiences include premium consumer SD and HD Video (for example, N-screen across different device platforms, managed and unmanaged video content, linear and non-linear video-on-demand as well as applications in areas like distance learning, telemedicine and community platforms like expert conferencing) as well as small medium businesses and enterprise mobility cloud, including the “internet of things”. Social networking experiences will permeate each of these applications, be they entertainment videos, gaming or shopping.

In a recent survey commissioned by Cisco, we found significant demand for broadband applications in rural areas as well.

Overall, we believe that, the mobile broadband would evolve into the “internet of everything” concept, with new and innovative consumer experiences that would change the way they work, play, learn, communicate, transact, monitor and control.

Where do you see the broadband segment in the next two-three years? What will be the key growth drivers?

India is primarily a mobile country with more than 95 per cent telecom subscribers on the mobile. Mobile internet, due to its greater reach as well as deployment timelines and cost economics, would continue to gain traction over wireline.

Cisco, in its Visual Network Index tool, which forecasts and analyses the growth and use of IP networks worldwide, predicts the following for India internet traffic growth over 2011-2016:

• Mobile data traffic would reach 0.47 exabytes per month in 2016, the equivalent of 117 million DVDs each month or 1.3 billion text messages each second; More than 60 per cent of this traffic would be video.

• Mobile data traffic will grow 58-fold from 2011 to 2016, at a compound annual growth rate (CAGR) of 126 per cent.

• Mobile data traffic would be 25 per cent of total traffic; growing three times faster than fixed IP traffic from 2011 to 2016

• Average mobile connection will generate 274 megabytes of mobile data traffic per month in 2016, up from 7 megabytes per month in 2011, increasing at a CAGR of 108 per cent.

For the semi-urban and rural areas, time-bound execution of the National Broadband Network ‘Bharat Nirman’ program would be the key to providing broadband connectivity across the country. This initiative, along with the government spending on e-governance projects and state wide area network initiatives, is likely drive the growth of the broadband market further.

What are the business opportunities in the broadband segment for Cisco in India?

Cisco, with its focus on four architectural pillars ­ IP next generation networks infrastructure, manage/cloud , mobility and video ­ and their integration as a common platform (through Open APIs, analytics, policy and security, common network abstraction, network Virtualisation) is in a sweet spot to participate, shape and win the broadband opportunities in India across all the architectural pillars.

This combined with our ability to offer robust, intelligent, software-centric services (policy, deep packet inspection, operational support system/business support system), including plan, build and manage networks further strengthens our offerings.

With increasing subscriber demand for new internet and video applications, there is a need for intelligent, scalable broadband solutions. Medianet, an intelligent network that is optimised for media services, from the core network to the subscriber premises is crucial. As a global leader in ethernet and IP/multi protocol label switching (MPLS) networks, Cisco offers comprehensive broadband aggregation solutions built on a carrier ethernet design that is optimised for media services. This design converges residential, business, and mobile services over a single packet-switched infrastructure. The architecture of Cisco broadband solutions also provides advanced subscriber intelligence and policy control, as well as the end-to-end resiliency and scalability needed to deliver triple-play services. Cisco broadband solutions deliver:

• Industry-leading capacity and scalability

• Simplified operations, with comprehensive management and provisioning

• Proven carrier-class availability

• Comprehensive IP/MPLS features

Cisco builds its broadband solutions on a Cisco IP Next-Generation Network (IP NGN) Carrier Ethernet design. Business, residential, wholesale, and managed services easily integrate over a converged IP/MPLS infrastructure. With our broadband solutions, one can:

• Offer consistent and highly reliable transport of "any-play" services as part of an end-to-end medianet

• Deliver any type of service anywhere, to any device

Moreover, through the acquisition of NDS Group Limited, Cisco has expanded its global video footprint in new and emerging markets, further broadening its service provider presence and deepening customer relationships. The addition of NDS’ leading software solutions and systems integration expertise plays a key role in accelerating the Cisco Videoscape platform, the next-generation TV experience that is more immersive, engaging and social aimed at delivering better-than-being-there entertainment experiences.

What is going to be Cisco’s business strategy and key focus areas in the country for the next two-three years?

Cisco has and will continue to work closely with service providers to help them drive new monetisation models. From having wireline to wireless solutions, Cisco has a wide range of solutions to explore and tap in the future.  Our next generation broadband network architecture would be more elastic, intelligent and programmable.  The key features f this architecture would include:

• Creating a common programming capability of Network Elements with the OnePK Agent Architecture

• Really bring to life an elastic, virtualised infrastructure leveraging our DC assets as well as enabling elasticity across

• IP and Optical transport elements

• Have laid out a plan to enable subscriber service orchestration with integrated prime policy management and network analytics

• And lastly ­ created a set of Web API’s and client plug-ins that start to allow the HTML5 and other application development community to more easily and transparently leverage data and capabilities of the intelligent network, without needing to understand esoteric Network OS command structures.  This will enable us to allow a whole new pace of innovation and relevance for the network. This would help us harmonise our portfolio and leverage the breadth of our platforms into a single ­ end to end ­ services.

Also, cable digitisation is a big area that the company is focused on. A strong demand from consumers for features like HD viewing, live TV recording, interactive experience, coupled with the government of India’s mandate for the digitisation of cable networks across the country, has brought tremendous impetus to this industry. Cisco has locally designed set-top boxes for India and other emerging markets. With an architecture based approach and a wide portfolio of products and solutions, Cisco is well positioned to transition cable operators from service providers to experience providers.


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