Connect with us

Events

The FTTH Summit Emphasizes Fiber Investment To Meet New Policy Goals

 

V.Subramanian
Principal Analyst,
MTN Consulting, LLC

The FTTH India Summit 2018 held on September 28 in Mumbai was a long-awaited event for a telecom analyst like me. I reached early to grab a good seat but was surprised to see the conference hall was already bustling with over 400 people! It was lined up with several stalls from eager service providers but what caught my eye was that Jio clearly made up the lion’s share of the hall.

The conference turned out to be a great opportunity to witness, at close quarters, policy makers, regulators, and service providers deliberate on the uses and challenges of FTTH technology. The summit covered multiple topics, ranging from growth drivers of FTTH, ease of doing business, and network diversification. Some key takeaways from the summit are:

Ambitious government policy goals won’t come easy for Indian operators:The new telecom policy National Digital Communications Policy (NDCP) – approved 2 days before the summit— was one of the key topics at the summit.

Previously called National Telecom Policy, the new policy framework goes beyond telecom services and into emerging digital areas such as IoT, AI, cloud computing, and digital security. N. Sivasailam, Special Secretary, DoT – one of the key officials behind the policy and a speaker at the event said,

The policy from 1994 was largely conceived or evolved as a revenue generator for the government, [but] it is for the first time [that] this policy looks at the whole gamut of telecom infrastructure and telecom services not just as telecom but as a larger part of digital communications infrastructure”.

As part of its 2022 goals, the Indian government aims to provide high bandwidth speed (50Mbps connectivity throughout the country), create four million jobs, and increase the GDP contribution of digital communications to 8 percent (from 6% in 2017). These objectives are ambitious considering that the telecom industry currently faces crushing debt, high labour costs, and network performance issues such as call drops. The policy however falls short of explaining the roadmap to address these issues.

Sharing of infrastructure – the way forward: While FTTH has struggled to take off here, FTTH remains essential for broadband development in India given the limitations of copper and CATV-based broadband. An FTTH service helps to expedite operators’ entry into new markets like home automation, home surveillance, and digital TV services. In the near term, one intriguing opportunity for vendors – whether local or not – is in fixed broadband, where FTTx rollouts are underway at several companies, including Reliance Jio, Bharti Airtel, and BSNL.

But India’s FTTH deployments still face (at least) two related challenges: the heavy cost of fiber installation, and right of way (RoW) constraints. Generally, those issues get trickier, the closer one gets to the customer. However, even cell towers have inadequate fiber access in India. Describing the current state of the industry, SK Gupta – Secretary, TRAI– said:

“We have two main issues here. First only 22 percent of base stations today are connected to the optical fiber and second, apart from not being able to lay optical fiber due to several constraints such as RoW and so on, we are not utilizing the available optical fiber optimally.”

Per KS Rao’s (CEO – Telecom services business – Sterlite Tech) presentation, India’s optical fiber per capita is strikingly low at 0.1 km, in comparison to US (1.57 km) and China (1.14 km). Closing this gap will require support from local governments on RoW access, and big rollouts by multiple operators. That requires CapEx, and at a time when cost recovery looks risky given rock bottom service prices. Amidst tough competition it will not be possible for the operators to increase the prices anytime soon. Debt financing issues will force more operators to share infrastructure and fiber assets.

When asked how operators would fund the new FTTH investments, SK Gupta remarked, “Things will never go back to how they used to be, and this end is really a new beginning.”

So, this is to new beginnings!

Click to comment

You must be logged in to post a comment Login

Leave a Reply

Copyright © 2024 Communications Today

error: Content is protected !!