INR 75,000 Crore Is Required To Achieve Spanking Telephony Penetration In Rural India: Wipro

Must Read

Although India is the world’s  second largest country in terms of mobile subscriber base, but the telecom penetration in its rural sector is still patchy. Ironically, rural India accounts for 70% of entire population, but it accounts just 29% of the country’s total telephone (wireless and wireline) subscriber base. As of July 2012, India had 944.81 million subscriber base and really, the country needs to focus on its collaborative stakeholder ecosystem and drastic innovation in the service delivery in order to achieve 1 billion subscriber base mark. According to a recent report from Wipro Infotech, the first phase of Indian telecom subscriber base (500 million) growth was led by urban penetration.

The firm has also reported that lots of factors such as education background, lower banking privileges and poor infrastructures are responsible for plaintive telecom penetration in rural India. The rural sector of the country contributes almost 45% to its total GDP, despite of this, 65% of rural population is still unbanked. UP emerges as highest contributor to VAS revenue across the circles  and Bihar is at the top in the pre-paid recharges asserting. In rural sector of the country, the PC and Mobile ratio is 3:26; Definitely, it opens an opportunity for mobile broadband vendors, but it will depend upon them how to entice the population.

A dependency of telecom towers on direct grid (DG) is also one of the major concerns. The power supplied by direct grid ranges from 2 to 6 hrs daily in the rural areas and really, it’s tough for operators to manage ‘a proper run of the tower’ in such regions. In addition to these, the road infrastructure is also pathetic in the rural sector , if once the tower shuts down , then it’s not easy for telecom service providers to fix the issue immediately due to poor road infrastructure.

Advertisements

As per the report, a setting up cost of  a tower in India is around 30-35 lakhs, means for rural tower coverage, there’s need of INR 75,000 crore capital expenditure (CAPEX). Definitely, a huge CAPEX is required to setting up infrastructure realted to roads, power, tower site and other. The main hurdle is here that an average revenue per user (ARPU) is quite low in rural sector, just INR 10 per month. On the other hand, ARPU in urban sector is three times more as of rural sector. If telecom vendors once invest into setting up infrastructure in rural sector, then the recovery of the investment will become one of the challenges for them.

Although India has second highest mobile subscriber base, but the country has one of the lowest allocated spectrum. Indian Telecom service providers (TSPs) have just 7-8 MHz of spectrum, while an average band allocated to international vendors is 17.5 MHz. Indeed, the telephone (wireless and wireline) penetration in rural India has become one of the major challenges and we can’t ignore the contribution of rural sector to national GDP.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest News

TikTok Oracle Deal: An Eyewash Or Mockery?

On Saturday, within few hours of US Department of Commerce announcing the ban on TikTok that would...

Apple And Google Are Changing Norms: Go Default with Gmail and Chrome On the New iOS 14

For long Apple iPhone and iPad users are forced to use Gmail and Chrome as an optional service on their devices. The...

Apple Store In India: More Of Disappointment Than Excitement?

Apple has started making moves to strengthen its presence in India. With the launch of Apple online store in India today, the...

The Advantages of Java Logging

If you're a fan of Java logging, you already know that there are three main types, Log4j, Log4j2, and SLF4j. They all...

Jio Postpaid Plus Plan Offers Free Netflix And Amazon Prime To Give Airtel and Vi Run For Their Money?

The just launched Jio Postpaid Plus plan is making heads turned. Just when you think Mukesh Ambani led...

TikTok Oracle Deal: China is Not Happy

Beijing is not at all happy with how the TikTok-Oracle deal panned out! In an editorial, Global Times, the...

In-Depth: Dprime

Will ‘TikTok By Microsoft’ Be A Winner?

For the last two years, TikTok has been in the public eye for all sorts of reasons. First, it was the exploded...

Facebook Subscription Model: Looking Beyond Ad Dollars?

Seldom do job listings create a stir this gripping. However, when the job listing in question is a stealth post from Twitter,...

Will The Online Food Delivery Market in India End Up Becoming A Two-Horse Race?

It's pretty much evident that the food delivery space in India is all set to get riled up soon enough as one...

More Articles Like This