The Telecom Regulatory Authority of India (TRAI) and the Department of Telecommunications (DoT) differ on whether to use funds from the Universal Services Obligation Fund (USOF) for subsidising broadband rollout in rural areas.
TRAI feels that since the government is investing in laying an optical-fibre cable network across the country, USOF support is not required. However, the USOF section of DoT wants both projects to run simultaneously.
In an internal note, USOF has said, ?The rural wireless broadband scheme and optical fibre up to the village scheme, are neither competitors nor mutually exclusive but will complement and supplement each other. While the wireless scheme will take care of last mile connectivity, the optical fibre scheme will facilitate and provide the bandwidth to meet backhaul requirements.?
TRAI had earlier suggested laying an optical cable up to each village in the country, as part of the National Broadband Plan. DoT has accepted this recommendation and is in the process of getting Cabinet clearance for the project. The estimated cost of this project is around Rs 200 billion.
In addition, DoT is set to float a tender for supporting wireless broadband services through a bidding process. The wireless project is expected to cost around Rs 20-30 billion. According to DoT’s plan, both these projects will be supported from the USOF.
TRAI has, however, raised objections to the wireless project on several grounds. It has told DoT that the scheme, under its present form, is anti-competitive since only two operators will be given subsidy support in each circle. TRAI feels that the subsidy will indirectly allow two operators to underwrite its costs. TRAI also said that the project will make it appear as if the government was promoting 3G and broadband wireless technologies.
TRAI has also raised questions on the quality of service and the benchmark value for each circle stipulated by DoT in the draft tender.
Rejecting TRAI’s view on the project being anti-competitive, USOF has said that the two operators will be selected through a bidding process giving every operator equal chance to qualify for the subsidy.
On the issue of promoting specific technologies, the DoT wing said that the project was technology-neutral and similar projects for broadband over satellite and cable TV networks will soon be launched.
