Magnificent And Marvelous Development of Telecoms & I.T –

What Next?

By DR T.H. CHOWDARY

Director: Center for Telecom Management and StudiesFellow: Tata Consultancy Services

Chairman: Pragna Bharati (intellect India )Former: Chairman & Managing Director

Videsh Sanchar Nigam Limited &Information Technology Advisor, Government of Andhra Pradesh

T: +91(40) 6667-1191(O) 2784-3121®F: +91 (40) 6667-1111

hanuman.chowdary@tcs.com

World Telecom & Information Society Day: IE, Hyd 17th May 2012

Apply, Apply – No ReplyHaath haath mein Cell Phone

• Magnificent, marvelous development of Telecoms & I.T due to

• Liberalisation• End to monopolies• New technologies • No sector matches telecoms

Spectacular Rise of Affordability Year(1)

PCI(2)

Year’s spend on phones(3)

Ratio(4)(2)to(3)

Telephones Teledensity

2004 Rs. 10,000 Rs. 10,000 1:1 10m 1%

2012 Rs. 65,000 Rs. 2,500 21:1 950m 80%

S452_Nov2010 4

PCI

AX TSP

Time

(a) Affordability

A PCI/ Tele-Service Price- PCI: Per Capita Income- TSP: Telephone Service Price- A: Affordability

How we achieved this

thc_ctms

The Road Traversed

• NTP 1994, NTP 1999, NTP 2012 bear out the truthVaasaamsi jeernani yatha vihaaya Navaani grihnaati naro-aparani

• New facts, new policies• Supply is creating demand – – new applications, new devices, new services

• Relentless migration to electronic form- e-commerce, e-books, e-learning, e-ticketing, e-marriage, e-talaq too…

Spanner in the Wheel

• TRAI’s high-10 times more – reserve price for auction of 2G spectrum

• Prices would go up 3 to 10 times• Rural penetration & usage suffers • Telcos will wilt-• 2G is not comparable to 3G, 4G…• Urban teledensity -85%• Rural = 40%• New markets in rural areas

-capital intensive-revenue poor

Flaws in TRAI’s Views

• Migrating 2G Telcos to 1800 MHZ Parts of Existing network to be abandoned

• More cell sites; nearly double• Value of spectrum cannot be linearly

projected • TRAI expects 50% data on 2G; but that would

go to 3G/4G operators; its price rise is under-estimate

Role of TRAI

• Is its mandate to generate/increase revenue to government ? or

• Increase affordability and coverage & variety• Why cell towers need to take unified licence and pay

a revenue share. TRAI assumes a revenue of Rs. 1900 cr to Government from Tower cos! Why should FDI be brought down from 100% to 74%.

• Do electric power transmission towers and distribution poles require licence & give revenue share?

DOT- Promotes or Retards

• Departments of I.T, Electronics, Renewable Energy, Tourism plead to promote the interest of their charges.

• DOT restricts, burdens, pains and punishes.“Abominable no-men”

… nay sayers”

What May be Done (1/2)

• Wind up Telecom Commission.• Recharge DOT.• Purge the TRAI – Remove IAS, from TRAI

(lovers of permit-licence-quota raj)• Remove Deputationists from DOT

(practitioners of monopoly)

What may be done to TRAI (2/2)

• Put liberal economists wealth creators & great businessmen.

• Social scientists.Engineers and IAS people without vision and a

social philosophy could be disastrous.

DHANYAWAD:THANK YOU