The upcoming National Digital Com­mu­nications Policy (NDCP) 2018 re­cog­nises digital infrastructure as the bedrock for the evolution of the government’s Digital India programme. It also highlights the importance of sharing this digital infrastructure. While wireless technologies will continue to be relevant, fibre will emerge as the most important alternative in the long run. The government is also realising the importance of fibre roll-out and is contemplating creating a Fibre Au­tho­rity of India. The scope of such an authority is, however, yet to be finalised.

So far, the fibre roll-out has been largely driven by operators and independent fibrecos. Not many tower companies have got involved with the fibre roll-out yet.

In the current context of the telecom industry, operators primarily focus on customer-oriented services while infrastructure providers (IP-1) fundamentally focus on providing the infrastructure to these operators. Under this structure, IP-1s do not access the end-customers directly; their revenue essentially comes from providing services to operators. However, with digital infrastructure coming to the fore, the issue of monetisation of this infrastructure be­comes relevant. As a result, IP-1s need to widen their spectrum and look at many more types of customer groupings.

There are many opportunities in the telecom sector, and BharatNet, the government-led fibre infrastructure project, is one of them. The basic principle behind the project is that once the relevant infrastructure is set up, demand will automatically emerge. Interestingly, in India, an integrated model is followed, where not only is the infrastructure rolled out but a demand is established for it. The structure of the Indian telecom industry is such that there is a different group of companies that focuses on infrastructure. So, for an IP-1 to develop a shared-services model, the government, operators and other service providers are needed as customers.

Similarly, in the case of smart city pro­jects, there is a lack of clarity on the business model. For an infrastructure pro­vider, the customers are the local mu­nicipal au­th­o­rity and other local government bodies. These entities have to integrate the pricing and revenue model for IP-1s to do their job.

The NDCP 2018 envisages the digital infrastructure as being fibre, towers and everything else that can be considered an element of integrated infrastructure. For example, data-oriented in-building solutions were mired in the issue of active and passive infrastructure sharing. Fortunately, the NDCP has resolved this problem and IP-1s can share both active and passive infrastructure. Hence, IP-1s can venture to roll out end-to-end infrastructure, which can be shared by multiple operators.

These business models need to be monetised. There should be clarity on who the customer is and what the revenue model should be. It cannot solely be a government project and a public-private partnership (PPP) model needs to emerge, wherever possible. There is a need for an action plan for implementation at the mu­nicipal and gram panchayat levels.

The government recognises this and is in the process of formulating an action plan. It is expected to play a crucial facilitation role. The infrastructure industry is not clamouring for funding support unlike some other stressed sectors. However, the customer base cannot be limited to only four operators. There has to be a wider base, of which the government will be a large component.

There is clearly a huge opportunity. For tower companies, there is an opportunity to fiberise towers, which is less than 15-20 per cent of the total at present. Ear­lier, the roll-out of fibre was based on customer requirements and it was hence rolled out to data centres instead of towers. Fibre roll-out was never coordinated with the roll-out of towers, which resulted in gaps between the two.

To leverage the emerging opportunities, putting the right business model in place and widening the scope of IP-1s are imperative. IP-1s are not targeting the end-consumer, but rather those who are catering to the end-consumer, be it the op­e­rators or the government. They are potential customers of IP-1s, who can provide a shared digital infrastructure.

Based on the views of Umang Das, Special Adviser, ATC India and Vice-Chairman, Tower and Infrastructure Providers Association