The connectivity Arctic in India- When will this ice melt?

Despite extensive telecom coverage, 5G rollout, and growing fibre networks, India still faces connectivity gaps. Here’s a reality check on the connectivity desert.

It is great to brag about how fast our OTT shows stream now or how quickly we can order a burger from that restaurant on the other side of the town. But there is more to the connectivity bubble we are walking in today. The picture on the other side of the pond is quite different.

Often digital arid zones fall behind in terms of economic growth, revenues, remote work opportunities, education, healthcare and new-age skills.

If we look at TRAI’s Indian Telecom Services Performance Indicators January–March 2023, the Internet penetration in India as of March 2023, stood at 880 million. The number of telecom subscribers as of March 2023 was over 1,172 million. On the contrary, Nielsen’s India Internet Report 2023 indicates that nearly half of the rural population is still not actively using the Internet. The current state of fibreisation of towers was observed at 38%, as per a KPMG India report for India Mobile Congress (IMC) 2023. According to an Ookla report, The State of Worldwide Connectivity in 2023, despite improvements in global connectivity, there are still areas that fall outside of network coverage.

These reports highlight the disparities in Internet performance between fixed and mobile networks across different regions, reminding the importance of addressing connectivity challenges worldwide. Interestingly, fixed networks demonstrated a 19% increase in median download speed (83.95 Mbps) and a 28% increase in upload speed (38.32 Mbps) in Q3 2023 compared to the previous year. Due to a lack of bandwidth (and therefore slower speeds), people in Africa and APAC areas need help doing many things on the Internet.

When the Organisation for Economic Co-operation and Development (OECD) checked data from the ‘Ookla for Good’ initiative, evaluating broadband speeds across urban and rural areas within EU and G20 countries, it found that fixed broadband download speeds in rural areas were close to 50% slower than those in cities. Digital Arctics are not something that the world can ignore anymore, especially when it is going full tilt with fuel like 5G and fibre.

Forgotten or far-flung?

It is a hard truth that while India is galloping fast on digitalisation, fibreisation, SatTech and lightning-fast download speeds, many in the country are still untouched by this revolution. Depending on their region, their constraints and the oblivion they suffer, their digital barren land hurts, and spreads.

“India has ‘connectivity desert’ issues with more than half of all the network subscribers reporting slow to no connectivity last year.”- Biswajeet Mahapatra, Principal Analyst, Forrester

According to data shared by TRAI, as of May 2023 Urban Telephone Subscribers were around 653.43 million and rural subscribers were 519.14 million. The urban teledensity was noted at 133.34% while it stood at 57.73% in rural areas. The share of urban and rural subscribers in total number of telephone subscribers at the end of May 2023 was 55.73% and 44.27%, respectively. For the record, the Delhi service area has shown a maximum teledensity of 273.19% while the Bihar service area was at a minimum of 55.61% at the end of May 2023.

India has ‘connectivity desert’ issues with more than half of all the network subscribers reporting slow to no connectivity last year, avers Biswajeet Mahapatra, Principal Analyst, Forrester. “With more workload including regular business activities, transactions, education, media and entertainment moving online, India is facing connectivity issues. It is not restricted to rural or far-off areas but is very much a challenge even in major metros and Tier-1/2/3 cities. Although a lot of investment has happened in the past few years in deploying 5G services, fibre optics, towers, etc., still it has not been able to satisfy the needs of consumers.”

Why do whiteouts lead to blackouts?

Neglecting these regions and people is full of implications – for the industry as well as the economy. These digital arid zones fall behind in many areas like economic growth, revenues, remote work opportunities, education, healthcare and new-age skills. As seen in the OECD-Ookla data, the gap between the proportion of individuals with at least basic skills in cities and rural areas can reach 50%.

There are many economic advantages or industrial applications that we are missing out on due to these ‘barren white spaces’. Mahapatra picks out many such areas. “This gap directly impacts any application or transaction which requires real-time data streaming or processing. These may include quality degradation in education applications, longer processing time for any task completion, making real-time monitoring difficult and IoT-built solutions useless. There is an impact on the overall cost of operations, and businesses are forced to invest in redundant or duplicate networks and services just to manage their operations.”

“High-speed Internet allows rural businesses to streamline operations by accessing cloud-based services and collaboration tools.”- Pravir Dahiya, Chief Technology Officer, Tata Teleservices

People can simply not take part in the modern economy without adequate connectivity, captures Petrus Potgieter, Associated Partner, Strand Consult. “For many applications, a mobile connection at LTE speed is still enough but if you want to broadcast video, for example, you need something better than that. Firstly, people need adequate connectivity for work as well as for education – even when this includes things like getting information about how to fix things around the house, something which most of us probably do from time to time. Secondly, industry and agriculture require connectivity for remote monitoring, remote device control and many other applications. Where regulation does not inhibit this, firms can often build out their infrastructure but for households, it is not as simple. Households with good connectivity can access services and information in a way that saves them a lot of time and money even if it is just basic government services.”

We also asked Pravir Dahiya, Chief Technology Officer, Tata Teleservices, and he shared some views purely as an industry technocrat, independent of the company’s strategy in this area. The situation of the ‘connectivity desert’ in India is largely the same in 2024 and has not changed significantly from 2023. He also remarked on the importance of this issue.

“Online marketplaces and reach to customers beyond physical boundaries get enabled by the presence of strong connectivity and digital infrastructure. This opens up opportunities for increased sales and revenue. High-speed Internet allows rural businesses to streamline operations and leverage technology-driven solutions. Access to cloud-based services, online collaboration tools, and real-time data analysis enhance productivity and decision-making,” Dahiya points out.

That oasis in the dunes

The good news is that penetration of the Internet in India’s rural areas has gone up 200% between 2015 and 2021, compared to the 158% growth seen by urban areas in the same period – as captured in the Economic Survey 2022-23. A big factor here could be the ‘Digital India’ programme launched in 2015; the country has seen the addition of more Internet subscribers in rural areas in the last three years, from 2019 to 2021, than in their urban counterparts (95.76 million in rural compared to 92.81 million in urban areas). In 2023, the government shared that over 6,00,000 km of optic fibre has been laid, connecting almost 2,00,000 Gram Panchayats. It also stated that over 425 million Internet users are present in rural areas compared to 295 million in urban areas.

“Cutting-edge technologies like the HTS, managed LTE SDWAN, and LEO services can help address the connectivity desert issues in India.”- Shivaji Chatterjee, President & Managing Director, Hughes Communications India

Potgieter, however, presents a different and optimistic picture. According to him, coverage gaps or ‘digit deserts’ are shrinking if the definition is kept constant. “The problem is that the demand for connectivity increases steadily so what might have been adequate coverage a few years ago can today denote a ‘digital desert’. I have observed how over the past five years, my household data consumption has increased from 1 GB per day to 30 GB or more per day, with working from home, video meetings, etc. This is why operators need to constantly invest to improve network quality.”

Experts believe that the advent of 5G and 6G, fuelled by rapid and wide fibreisation in the country, will fill this void soon.

Digital deserts must soon become part of the connectivity nervous system, not only for the democratisation of communication but also for various other outcomes. According to the KPMG report, the collective integration of 5G/6G, satellite communication (Satcom), and semiconductors could potentially contribute approximately USD 240 billion to the nation’s economy within the next five years, thereby adding 1.6% to the national GDP by FY2028. Achieving this will require 100% fibreisation of towers for the implementation of 6G.

Technologies such as FWA, Satcom, Full Fibre, and 5G hold significant potential. However, as Mahapatra observes, they are also expensive and currently available only in select areas. Until these technologies are deployed nationwide and made affordable, their impact will be limited. Each of these technologies faces its own set of challenges; for instance, Satcom encounters latency issues, bandwidth constraints, higher costs, and weather challenges. Similarly, 5G faces challenges such as device compatibility, initial high costs, security concerns, device proximity, and availability.

Potgieter illustrates that many digital desert problems can be resolved by leveraging existing Low Earth Orbit (LEO) satellite services. However, he notes that countries like India and South Africa have existing licensing requirements that hinder the official launch of such services. In contrast, in Malawi, for instance, Starlink service is available for less than USD 50 per month, offering a potential solution to numerous connectivity issues. Additionally, emerging solutions include billing systems for prepaid fixed broadband.

“South African fibre broadband firm Vumatel has deployed overhead fibre connections in slums, offering uncapped household service at about USD 5 per month. However, this needs certainty about municipal planning permission and related matters. This low price point is most realistic for relatively densely populated areas. FWA is not new and is a good solution for relatively low broadband speeds. AirJaldi is providing similar services in India and there might be other small companies doing the same,” he says.

Shivaji Chatterjee, President and Managing Director, Hughes Communications India shares how Hughes India in the last three decades has taken strides to address the digital divide issue in the country.

“From covering underserved areas with satellite connectivity to launching new services like High Throughput Satellite (HTS) for the unserved regions in India, we have been catering to all walks of society. With its managed LTE SDWAN suite of services, its HTS solutions and the upcoming LEO services, Hughes covers the entire length and breadth of India. These cutting-edge technologies can serve as the backbone to address the connectivity desert issue,” he highlights.

It is not about one technology but using all these technologies based on need, topology, and accessibility to ensure that cheaper, viable, effective, and non-interruptive yet good service is available for all the citizens, stresses Mahapatra.

In the same vein, Potgieter notes how all of the proposed solutions like 5G and 6G (other than the satellite) require a reasonable fibre optic backbone and it is important to ensure that firms can deploy fibre backbone circuits without excessive planning permission. “For local deployment, many developing cities do not have a good network of multiple-utility tunnels. Overhead fibre is an appropriate solution for these cities.”

In the assessment of Rohit Kochar, Founder, Chairperson, and CEO of Bert Labs, 5G and 6G can help a lot in improving the efficiency of data packets. “With the Edge Distributed Computing solutions we offer, we make sure that data transmission is efficient, in both upstream and downstream areas. This is crucial for the split-second decisions that are made at an enterprise’s edge, like at plant equipment.”

“Households with good connectivity can access services and information in a way that saves them time and money, even if it is basic government services.”- Petrus Potgieter, Associated Partner, Strand Consult

Potgieter, however, also shares a real-world example to remind us how regulation often prevents solutions on the ground. “A colleague of mine lives in a small town in South Africa and although there is now optical fibre broadband in the town, he cannot get service because the road in front of the house is a provincial road and the municipality cannot authorise the last-mile construction. This causes a digital mini-desert and I believe there are many like that.”

Time to redraw the blurry map

Just bringing the isolated island into the digital mainland will not suffice. The ‘unconnected’ has to match the quality, speed, experience and applications that the ‘connected’ enjoy already. True digital inclusion will manifest when there is a fair and equal distribution of connectivity in the complete sense. The Ookla report has also argued that it is not only about being connected to the network per se; the quality of that broadband connection is equally crucial. Unlike other utility services like gas and electricity, where quality is generally stable, with broadband, the quality of the network experience is crucial to ensure users can benefit fully from multiple applications, the report underlines.

As Mahapatra points out, the major challenge is the lack of competition in the telco business. “In many cases, it is reduced to an oligopoly market with few options for consumers. We do not expect any major new players to enter this business, making the situation even more difficult. Until and unless the government steps the service quality will remain the same.”

As Potgieter wraps it up well, “Functional literacy is a requirement for effective participation in an information-based economy and not something that can be changed overnight. However, making space, from a regulatory point of view, for a multitude of solutions and experimentation whenever and wherever it does not harm is likely to be the most fruitful approach.”

The thing about grass is that it makes the neighbour’s lawn look greener. The thing about snow is that it makes everyone’s backyard look the same. Until India thaws all the cold pockets that have still not warmed up to connectivity, we cannot fully claim that our porch looks better than others, no matter how much faster our OTT streams become in an urban apartment. Real digitalisation should be felt everywhere. Time to change the green-eyed to the blue-eyed.

By Pratima Harigunani

pratimahh@cybermedia.co.in