(by Diwaskar Chettri & Nikhil Pahwa)
Instead of lowering rates for broadband, public sector owned telco BSNL, which has around 54.09% (7.6 million) of India’s dialup Internet subscriber base (report), has launched a prepaid Broadband service, that appears to be more expensive on a monthly basis, than a post-paid one. The installation and modem charges for both pre-paid and post-paid are the same, just that prepaid users don’t need to give a security deposit or an advance monthly rental, which, incidentally, means that their postpaid broadband plans are essentially prepaid.
What the prepaid allow, is for consumers to keep a broadband connections, but choose not to renew the connection for a while. Still, the pricing is based on either days of use in case of unlimited plans and per MB in case of limited data plans: As a result, the pre-paid plans appear to be a lot more expensive:
1. Unlimited Download/Upload Plan:
If a customer does subscribe to, say, the 256 kbps unlimited plan for a month, she’ll end up paying Rs. 900 for a pre-paid plan, while in case of postpaid, the charge shall be Rs. 750. Thus the prepaid subscription is 20% more expensive than postpaid. The 512kbps plan is 12.5% more expensive than postpaid.
2. Limited Download/Upload Plan:
BSNL has priced prepaid with limited downloads on a per MB basis, which makes it quite expensive, particularly when you take into account that they’re charging according to the number of MB utilized: for Rs. 250, after service tax and administrative charges are cut, at Rs. 0.6 per MB, all you get is around 336MB of data per month. For Rs. 500, users get 671mb for 45 days.
BSNL is also offering validity vouchers with no usage of Rs.100, Rs.150 and Rs.250 and Top-Up Vouchers worth Rs.100, Rs.200 and Rs.500.
Given the higher cost, this clearly doesn’t encourage an increase in broadband usage in India, though it might help bring more people into the system because of the lower entry barrier: a security deposit and one month of advance payment isn’t there for prepaid broadband users. It doesn’t really appear possible for BSNL to achieve its mandate of increasing broadband usage in India, and its about time the Indian government opened up the last mile. Then again, that would devalue the BWA auction, wouldn’t it?