India’s Telecom Regulator TRAI is now looking at financial disincentives for ISPs not meeting the Quality of Services benchmarks set by the regulator. While the fines haven’t been finalized yet, the proposal is to fine ISPs Rs 50,000 per parameter for the first non-compliance and Rs 1,00,000 per parameter for subsequent noncompliance of the benchmarks. There’s also a fine of Rs 5000 per day if an ISP doesn’t submit, and Rs 10 lakh if there is a false report.
If you think this should be any different, you can mail your comments to the TRAI at [email protected] by 9th November, 2012. The regulation, if passed, will come into effect from 1st of January 2013. Download the draft version here.
Why This Is Not Enough
Sure, the quality of broadband connectivity in India is abysmally poor, there’s probably isn’t a single ISP in the country that delivers what it promises. This business of enforcing Quality of Service through fines is not a step in the wrong direction – but it is clearly not enough. The big picture focus of the government is on setting up its Bharat Broadband project, which is looking to bring fibre to Rural India, but it’s missing the fact that even in urban India, there are issues of availability of broadband, and even when broadband is available, quality of service is abysmal. While the focus is also on mobile connectivity, limited availability of spectrum will stunt growth of wireless as a medium for broadband. You won’t be able to stream 300 simultaneous live streams of a Cricket match in any part of the country on 5MHz of 3G.
Here are 5 things that the Indian government can do to improve broadband penetration:
– Unbundle the last mile of broadband: Wireline connections in India are declining and BSNL and MTNL are sitting on priceless right of way access that forms a major component of an ISPs growth. It’ll lead to an increase in competition among ISPs, perhaps a drop in prices.
– Mandate Internet wiring in new buildings: Enforce a situation wherein each new construction comes with wiring already available in homes, so an ISP just has to plug in to provide broadband.
– Create complaint redressal mechanisms: Enforce setting up of a redressal mechanisms for consumer complaints related to Internet connectivity. Just assessing quality of service parameters and asking ISPs to submit, isn’t sufficient.
– Get rid of the ridiculous 8% license fee: Broadband isn’t mobile telephony. Growth will never be as quick as that of mobile. ISPs need to be incentivised to grow, else broadband will remain an elitist service. The license fee that is being levied will be passed on to consumers, so it will discourage adoption, and encourage cartelization instead of pushing for competition.
You might take fibre to villages, but where is the incentive for an ISP to grow the base? The conditions – lack of unbundling, the license fee – are resulting in a wait and watch approach from ISPs. No one really appears to be looking to raise capital to push for growth because the regulatory environment is to mobile telephony centric and restrictive.