As India witnesses surging levels of data consumption, optic fibre cable (OFC) is being seen as the most suitable medium for catering to this burgeoning demand. The need for significant OFC capacity in the last mile has only multiplied with the Covid-19 pandemic. Today, most of the data generation is happening inside buildings. The consumption of bandwidth-intensive applications such as high resolution videos is on the rise. But the kind of coverage and capacity available inside buildings is severely restricted. Further, as fixed and mobile services are increasingly converging, the need to deliver fibre-to-the-home (FTTH) or fibre-to-anything (FTTX) is becoming even more apparent. At a recent tele.net conference, senior representatives from different stakeholder groups in the OFC value chain shared their views on emerging trends in last-mile connectivity, role of fibre, key challenges and growth drivers. Edited excerpts…
India is a fibre-starved country. Despite efforts that operators and IP-1s have put in over the past five years, we still have a long way to go. We have barely 25-30 per cent fibre connectivity to towers, while in the US and China it is about 80 per cent. Countries in Africa are at over 60 per cent, and Korea is almost 100 per cent. We, in India, have a long way to go if we want to induct high-bandwidth-intensive future technologies and applications such as 5G, internet of things, machine to machine, augmented reality/virtual reality and connected cars. These will not operate until we have fibre everywhere.
Covid-19, in some ways, has underlined the importance of fixed broadband networks. Fibre is now being considered essential and an “absolute must” for supporting next-generation data-intensive networks. Going forward, as working from home becomes the new normal, we would need a lot more fixed broadband than we have ever wanted in the past.
That said, this will not be an easy task. Right of way (RoW) continues to be a bottleneck in fibre deployment. Further, given their financial condition, operators are finding it challenging to earmark significant investments in infrastructure creation and expansion. To this end, the Telecom Regulatory Authority of India’s (TRAI) recommendations to enhance the scope of IP-1s to allow them to provide fibre, Wi-Fi and in-building solutions on ground is a positive development. This is a step in the right direction as it allows operators to save on costs that they would have incurred to roll out the same infrastructure. Therefore, implementation of TRAI’s recommendations will help in reducing operators’ capex and will also allow them to focus on other areas such as technology upgradation and marketing, while leasing fibre from a neutral host like IP-1s.
With work and learning from home becoming the new norm, the usage of essential communication platforms and networking tools has increased multi-fold. Network traffic has skyrocketed with telcos and cloud service providers reporting large spikes.
The traffic is becoming more symmetric in nature – we have as much upstream traffic being generated as that of downstream. We have seen a growth of 30-40 per cent in terms of data consumption for different operators in residential areas, where we have built last-mile networks. At the same time, this surge in demand has reiterated the inadequacy of the last mile infrastructure in the country. The “new normal” has led to a point where the shift to digital is permanent and validated.
Interestingly, we mostly talk about urban areas, where telcos primarily are looking for partners to connect various sites. However, rural areas are fast emerging as growth centres for data consumption. Rural connectivity is primarily driven by the government through a number of projects under the BharatNet programme and we are working on a number of state-run projects in Maharashtra and Telangana. We see several use cases emerging from rural India in the coming years and envisage that telcos will invest in rural areas as well.
Going forward, the new digital networks will continue to be driven by optical fibre. Last-mile connectivity will not be restricted to homes and will, instead, move to anything and everything, be it a home, curb, or any and every premises. Fibre is the best option to offer high-speed broadband connectivity and with the roll-out of 5G, FTTA (fibre to the antenna) will also become critical.
In the past two months, owing to Covid-19 lockdown related movement restrictions, there has been a tremendous data growth across wireline and wireless segments. Schools have gone online and kids are studying from home. Offices are asking their employees to work from home. Over-the-top service penetration has steadily increased in the past four months as people continue to stay indoors all the time. Video has emerged as one of the key data consumption drivers. The magnitude of data traffic is clearly putting pressure on home broadband networks.
Last mile fibre connectivity is one of the challenges while connecting customer locations and a common approach to avoid duplicacy may be helpful.
For enabling future data growth by way of wireless and wireline connectivity, fibre penetration needs to be augmented by multi-fold. Looking at current fibre deployed across the country, good amount of fresh fibre rollout is required. Secondly, we need to see how available network is being optimised and utilised.
Last but not the least, we need to look at how to ensure quality of service. As data volume and application usage are increasing, screen time is also expanding and therefore, quality of service in terms of a seamless, consistent user experience becomes critical.
Today, we are connected to the network via home/ office Wi-Fi, FTTH, copper-based DSL, 3G or 4G. This represents the spread of “last mile” connections we have in India. 4G connectivity in the country has improved significantly over the last five years. As on date, 96 per cent of mobile data traffic is carried on 4G networks. To support this front-end connectivity, we have about 600,000 towers to provide pan-India coverage. Of these towers, only about 30 per cent are fiberised today which impacts the quality of mobile broadband. That is the first opportunity for the telecom industry. The opportunity needs to be supported by uniform implementation of RoW policy.
Covid-19 is transforming work culture in the country. Recently, one of the largest employers in the country – Infosys – announced that 33per cent of their workforce will work from home permanently. They are among several other organisations, large and small, who are seeing working remotely as the new reality. To support this changing reality, we will see faster adoption of FTTH or home broadband connections which can provide the next wave of growth in networks. So, after 4G but before 5G, we are likely to see the demand for reliable wireline connectivity in India. That is the second area of opportunity for the sector. This will also pave the way for demand-driven deep fibre networks followed by 5G which can build on these dense access networks.
We are in a world where seamless last-mile connectivity will be provided by converged networks. Going forward, we shall see 4G, 5G, FTTH and Wi-Fi co-exist to provide reliable, high bandwidth connectivity. OFC will be the fundamental building block of these next generation networks. The quality of the service you get depends largely on one aspect – how close are you to fibre? The choice of fibre will play a critical part in the network cost and performance. Fibre represents less than 1 per cent of the network cost and the right choice of fibre helps the operators optimise cost and strengthen quality of service delivery.
Fibre is required in the backhaul, middle haul, and in almost every part of the network. In the past few years, we have seen a significant portion of the existing last mile getting converted to fibre. That said, last mile remains a challenge in India. Building a backbone is much easier, but the real challenge lies in connecting every home, building and dwelling unit. Also, the country has a vast geography and the population is huge. If India has to reach where Korea or Japan are today, it needs at least 5 million-6 million km of fibre.
Further, during the Covid-19 pandemic, industry-wise we have seen an 18-20 per cent increase in data consumption across networks. With more and more employees working from home, the pressure on fixed broadband networks will only continue to rise.
From an organisation’s point of view, Airtel has been a strong proponent of infrastructure sharing. Today, there is a digital divide as far as infrastructure is concerned. There are entities that own this resource but are not able to utilise it or maintain it. There are those that can maintain, deliver and connect but either do not have the right business models or suffer from certain policy gaps.
As an industry, we have not been able to leverage resources lying with Bharat Sanchar Nigam Limited, Mahanagar Telephone Nigam Limited, and other central public sector undertakings and BharatNet’s network. We are currently using services of IP-1 providers for last-mile connectivity and will continue to do so.