Centre for Internet and Society

A Market Structure for Digital India

Shyam Ponappa — 2016-10-10T02:09:06Z

If delivery is priced below cost, communications services will be unsustainable and ineffective. The stress in the telecom sector is evident from the data. The market capitalisation of listed telecom operators has been stagnant since the 3G auction in 2010, while the government collected Rs 2.83 lakh crore of non-tax charges from them.

The article originally published in the Business Standard on October 5, 2016 was mirrored in Organizing India Blogspot on October 9, 2016.

In March 2010 before the auction, the capitalisation was Rs 1.84 lakh crore; in March 2016, it was Rs 1.71 lakh crore, with the BSE Sensex up nearly 60 per cent. A larger share of earnings has gone to government rather than shareholders, and also to banks as interest (Rs 2.08 lakh crore). The irony is that no operator has bid so far for the most useful spectrum bands on auction, 700 and 900 MHz. Uncertainties abound, and there are several questions.

Reliance Jio's entry, although expected, is a jolt. Will voice calls priced below mandatory interconnect charges be treated as being predatory or anticompetitive? The technicality is that Jio doesn't have high market share, apparently a criterion under competition law. Will this hold, given that Jio's entry has reduced total market capitalisation? Will delivery capability in terms of network size and/or market power from associated businesses be relevant criteria for dominance? What happens when Jio does have sizeable market share?

On the face of it, lower prices seem better for users. Look more closely and it's not so simple, especially when you consider other services in India offered for free or at highly subsidised rates. One issue is the structure of a market that supports delivery below cost, and its quality of services/products. Another is the criterion that maximises social welfare that should drive government's policies. Is consumer surplus in the short term a reasonable criterion? As it happens, we have experienced markets with constrained consumer surplus for years. For example, in the category of infrastructure and essential inputs/utilities, we've had this approach towards fertilisers, electricity, petroleum products like kerosene, cooking gas and diesel until recently, water, and sewerage. We've also experienced this in our entire range of manufactured products earlier, when we had exorbitant import barriers. These experiences have been less than sanguine. The misuse of kerosene and gas, and the effects of diesel subsidies are prominent examples. The distortions that have set in, such as overuse of ground water and fertilisers, and the vicious circle with electricity and diesel generators, will be difficult to correct.

Aren't there similar deleterious effects in communications from spectrum auctions and government charges that inflate input costs, and price wars that degrade investment capacity for network extension and delivery? As it is, the quality of services for voice and data is very poor. An essential resource for better connectivity is spectrum, yet government's approach to its management has been and remains inimical to its stated objective of achieving ubiquitous access of good quality. Governments make it difficult for operators to extend networks simply by not setting the right administrative policies. To quote Google Vice-President Caesar Sengupta: India is "a very large country with very little spectrum". It does not seem clear to our governments that broadband access through fixed lines for everyone is infeasible in the foreseeable future. Also, that unless radical changes are made, it is inconceivable that broadband servcies can be made available at prices and quality comparable to TV.

The Triad of Interests

Even if the criterion for public welfare is user benefits/consumer surplus, judging by price alone is simplistic, because it misses other aspects of service delivery that contribute to the cost-benefit package. One essential aspect is ubiquitous access. Another is effective, consistent service delivery, which requires quality, and stability. A third is the period or life cycle. It doesn't help if you have an inexpensive product or service today, and nothing tomorrow. The definition of long term also varies, depending on one's perception of the life-cycle cost of the product/service. For a user, it may be several years, or his/her life cycle. For a society, it may mean generations.

In addition to consumer benefits, other factors need to be considered from the perspectives of pragmatism and realpolitik. Realistically, a triad of stakeholder interests has to be balanced for a sustainable beneficial outcome. These are: consumer and producer surplus, and what might be termed "government interests" in the broadest sense defined below. The latter has been manifest in many global spectrum auctions, and although detrimental to the sector, is an aspect of reality that cannot be wished away. For example, our governments preferred rationing and auctions to more constructive approaches such as sharing infrastructure, and when the Supreme Court ruled that resources need not be auctioned, spectrum was excluded, which seems logically indefensible. For sustainable, consistent services, champions of all three criteria must partner to adopt mutually acceptable solutions.

Assumptions about Enabling Policies

Certain basic amenities comprise the essential infrastructure that everyone needs to be productive and have reasonable well-being. To some extent, this is linked to reasonably high per capita income. Without it, broad access to good infrastructure is infeasible. It takes that level of organisation, institutions and investment, including its implications for developing and organising human capital, to build such capabilities, as in Organisation for Economic Cooperation and Development (OECD) countries. Emerging economies have to manage with lower order platforms, or a subset of higher order services combined with others of lower order. Prioritisation then becomes the key, and areas of emphasis have to be chosen. This is where the priority accorded to Digital India comes in. If digital systems are crucial facilitators for development and productivity, they need to be accorded that level of importance and effort, with substantive changes to policies.

The government sets the policies and incentives. Government here means not just the central government and the states' executives, but the gamut of regulatory and government agencies: the legislature, the regulators, and the judiciary. These agencies must converge and persuade public opinion to support action in the public interest. Ultimately, society has to pay. If delivery is priced below cost in communications, the services will be as unsustainable and ineffective as in other distorted sectors with freebies.

Reference: Krishna Kant: http://www.business-standard.com/article/economy-policy/spectrum-fees-leave-no-money-in-shareholders-pockets-116092701398_1.html, Business Standard, September 28, 2016. The author can be contacted at shyamponappa@gmail.com

For more details visit https://cis-india.org/telecom/blog/business-standard-october-5-2016-shyam-ponappa-a-market-structure-for-digital-india

A lifetime of five years on the internet

praskrishna — 2013-05-20T09:04:28Z

Centre for Internet and Society observes its fifth anniversary on Sunday.

The article by Subir Ghosh was published in DNA on May 19, 2013. Sunil Abraham is quoted in this.

Five years is a long time in the internet space. The past five years, certainly, has been. And so has it been for the Centre for Internet and Society that completes five years here.

When a group of citizens got together to come under a platform called CIS five years ago, they had wanted to work on policy issues about the internet that had a bearing on society. They, in fact, still do; except that the new media space itself has undergone a metamorphosis. Five years ago social media was just starting off, few people had smart phones, and online speech was not a burning issue.

Sunil Abraham, executive director of city-based CIS, affirms this, and goes on to assert: “Five years ago, privacy was not a mainstream concern. Today, many different actors and stakeholders are interested in the configuration of the draft Privacy Bill. We first warned the public about the draconian measures in the IT Act during the 2008 amendment. Four years later, many more people are familiar with problematic sections and are adopting various strategies to amend the Act and it’s associated rules.”

Likewise, five years ago, people dismissed “shared spectrum” as a pipe dream; today “shared spectrum” is mentioned in the National Telecom Policy. CIS usually thinks ahead, and works on a range of issues.

“For internet adoption in India to grow dramatically from the dismal statistics today, we need to ensure continued access to cheap devices and affordable and ubiquitous broadband,” says Abraham.

“With Ericsson suing Micromax for Rs100 crore, the mobile wars have come to India. If we have to protect innovation in sub-100 dollar devices, we need to configure our patent and copyright policy carefully.”

But since CIS works primarily on policy issues, shouldn’t it have been based in Delhi rather than in Bangalore? “We do have a small office in Delhi. But we are headquartered in Bangalore because we need to keep learning from technologists and the technical community,” explains Abraham.

When an organisation calling itself the Centre for Internet and Society (www.cis-india.org) observes its fifth anniversary, it shouldn’t surprise anyone that many of the activities related to the anniversary celebrations (May 20-23) have precious little to do with the internet, and is more about society itself. And yes, an entire evening is devoted to Kannada. There’s a talk by Chandrashekhara Kambara on ‘Kannada in the modern era,’ and another by UB Pavanaja titled ‘From Palm Leaf to Tablet – Journey of Kannada’.

“We are looking at the complete eco-system. For instance, during the digitalisation of TV in India, what will happen to the internet? Do TV promoting policies undermine the growth of broadband? On the second day we look at the connection between another older technology - cinema and the Internet.”

For more details visit https://cis-india.org/news/dna-india-may-19-2013-subir-ghosh-a-lifetime-of-five-years-on-the-internet

A great start on Wi-Fi reforms

Shyam Ponappa — 2018-11-30T16:43:14Z

The 5 GHz regulations are exactly what we needed for a start. But we need a lot more, and not only from the DoT.

The article was published in the Business Standard on November 1, 2018 and mirrored in Organizing India Blogspot on the same day.

This item of detail is almost like magic. The MoC has done something splendid regarding Wi-Fi. Its 5 GHz spectrum regulations have everything we could wish for. But it’s a first step — only the first. Much more is needed to reap the benefits.

To put it in context, we now have a policy that enables effective broadband Wi-Fi hotspots, and profound changes in connectivity are feasible for the last mile in India, as in other countries. A high proportion of smartphone traffic abroad is over Wi-Fi. In the recent past, in the US it was around 70-75 per cent, while Japan was around 83 per cent, and Germany about 87 per cent.[1]

Traffic is offloaded from licensed spectrum, freeing it up for re-use. We have 605 MHz added in the 5 GHz band to the existing 380 MHz for Wi-Fi, and a removal of restrictions on external usage as in the US, so Wi-Fi will have much greater capacity.

The ramifications, however, are ironic. These regulations could lead to a surge in economic activity, and consequent benefits from connectivity. But this will increase imports, which are already overboard on account of oil prices and technology imports, an aspect discussed later in this article.

The increased activities in network installation and ensuing benefits will vary depending on supporting ecosystems of policies and practices. This applies within the communications sector as also at points of interface with other sectors, such as electricity and finance. To illustrate, in communications, consider an unlicensed band in most markets including the US, the UK, and Europe, namely the 60 GHz V-band. Whereas the Federal Communications Commission (FCC) in the US delicensed 14 GHz in this band for “wireless fibre” called WiGig, India hasn’t done so. Instead, another WPC[2] notification in October delicensed only 500 MHz (61-61.5 GHz) at very low power. Devices abroad that use this band for 400-metre and 700-metre connections have channels of 2,000-2,500 MHz acting as wireless fibre links over short distances. These can’t be used here. Short-distance connections to Wi-Fi and wired networks in offices and residential, commercial and industrial complexes will need fibre or cable.

This policy link is missing, perhaps because operators oppose it. The user network traffic bypasses operators to the extent that Wireless Internet Service Providers (ISPs) and other entrepreneurs set them up and collect charges, whereas operators have paid huge premiums for the spectrum required earlier. A solution that enables commercial deployment by licensed operators would solve this problem, although ISPs would have to go through operators as before. Another alternative could be to have unlicensed access to public wireless networks owned and operated by BSNL/BharatNet/CSC, or by operator consortiums, on payment of service charges by operators and users.

Equally essential are aspects of ecosystems that are adjuncts from sectors such as power supplies, finances, and local manufacturing, for substantial and stable growth. So for convergence resulting in significant benefits, these are the kinds of problems that will have to be resolved:

The power situation, with a conscious shift towards more distributed, renewable (solar and, in some areas, wind) energy, with changes comparable to Wi-Fi/5 GHz in policies and practices.

The financial system and non-performing assets (NPAs), including the steady revival of infrastructure projects. While dealing resolutely with malfeasance and fraud, nursing and reviving good infrastructure underlying the NPAs is crucial. A sorry plight, but if revivable infrastructure projects are allowed to fail, they end up as unproductive, wasted assets (a repeat of Dabhol), with negative multiplier effects.

The imperative for the domestic manufacture of equipment to reduce imports. This is going to be an escalating compulsion because of our market size, unless we develop solutions that help balance imports, such as a compelling tourism strategy (but just think of the complexity of the ecosystem elements that need improvement) or communications equipment exports (equally complex).

Meanwhile, we are on a path committed to curbing demand to contain the deficit: Battening the hatches, tightening belts, and waiting for oil prices to fall /exports to rise, keeping a wary eye on the current account deficit (CAD) because of imports, and inflation. This pressure may persist for months, possibly even years, restricting growth. Aren’t there feasible, growth-oriented initiatives, tempered by not exceeding reasonable bounds, including the CAD?

The data on the CAD, capital formation, FPI inflows, and FDI are in the chart below.

CA: https://rbi.org.in/scripts/PublicationsView.aspx?id=18603 GFCF: https://data.gov.in/sites/default/files/datafile/Table3.10.xls
FPI Inflows: https://rbi.org.in/scripts/PublicationsView.aspx?id=13729 https://rbi.org.in/scripts/PublicationsView.aspx?id=18599
FDI Equity Inflows: http://dipp.nic.in/sites/default/files/FDI_FactSheet_29June2018.pdf

A study of data from 2001 to 2016 of how the capital account and its components, the current account, and gross fixed capital formation affect each other concluded that sustained capital formation requires more foreign direct investment (FDI) relative to other flows.[3] FDI was found to have an indirect effect on capital formation, which was found to affect the current account. Debt portfolio flows and nonresident deposits financed the current account, but did not contribute directly to capital formation.

In Indonesia, a study of how the CAD affects exchange rates found that when it exceeds about 2 per cent of the GDP, the exchange rate depreciates over 12 per cent after a four-month lag.[4] Tracking such relationships in India would be useful for policy making.

Meanwhile, India’s large growth sectors are plagued by unsustainable economics. For sustained growth, they have to be organised more rationally, to generate profits for productive enterprises. Promising domestic sectors include electricity, communications, and aviation. Bypass strategies as in software and IT-enabled services won’t work, because these services are for domestic markets. They must generate profits without labour arbitrage, while balancing imports and exports, unless growth continues to attract foreign capital. Genuine reform as for Wi-Fi and 5 GHz spectrum with collaboration involving the private sector and governments modelled on the automotive sector are a possible way forward.

[1]. Claus Hetting, October 2018: https://wifinowevents.com/news-and-blog/japan-83-of-smartphone-traffic-runs-on-wi-fi/; https://wifinowevents.com/news-and-blog/germany-wi-fi-carries-87-of-smartphone-traffic/

[2]. WPC: Wireless Planning and Coordination Wing, Department of Telecommunications

[3]. Ashima Goyal & Vaishnavi Sharma, September 2017: http://www.igidr.ac.in/pdf/publication/WP-2017-016.pdf

[4]. Nugroho et al, January 2014: http://bmeb-bi.org/index.php/BEMP/article/download/445/420/

For more details visit https://cis-india.org/telecom/blog/business-standard-november-1-2018-shyam-ponappa-a-great-start-on-wifi-reforms

A Great Start (for the Modi government)

Shyam Ponappa — 2014-07-04T07:32:01Z

The National Democratic Alliance government has made a terrific start. Time will tell how this plays out, but it has begun decisively and set a sure tone.

The article by Shyam Ponappa was published in the Business Standard on June 5, 2014 and mirrored in Organizing India Blogspot.

With such an unequivocal mandate, it would have helped to avoid jarring notes like the appointment of the principal secretary to the prime minister through an ordinance. Besides, the government has already shown wisdom in its actions in not rolling back the previous government's good schemes and in extending senior administrators' incumbencies.

If this wise approach continues to show in their thinking and action, greater support is likely from civil servants, citizens, and perhaps even opposition politicians, resulting in better outcomes. It's a question of pulling together towards common goals, or pulling in different directions. Think of the indecisive second term of the United Progressive Alliance (UPA), and recall that it was the Bharatiya Janata Party that stalled the functioning of Parliament on many occasions, including measures such as the induction of the Goods and Services Tax (GST). The general perception, however, was of a dithering UPA unable to coordinate and achieve results. In other words, impressions are more important than the reality of untidy facts.

This is why it's important that the PM and his team consciously create a good impression and carry people along. If they can do that, they are likely to achieve a great deal for us all. Instead, if they are perceived as heavy-handed, roughshod, and not going through due process, the salutary effects of exemplary leadership and governance are likely to be lost. The two-thirds who voted for others recently might well begin to converge, so that an opposition that is currently non-existent because it is dispersed, begins to coalesce. This could obstruct a high-handed government, or even try to pull it down. The result, as before, is likely to be irresponsible shouting matches and disruptive behaviour in Parliament that have stymied efforts to improve our lot.

The Tasks Ahead

There's so much that needs to be done in so many areas to recover our growth prospects and potential that it is truly daunting. For instance, consider infrastructure, and take just one aspect of it: energy and power supply. This covers many things:

The need to build electricity generation from all sources;
The supply of fuels, including the mining, transportation and pricing of coal, the development and pricing of hydrocarbons, hydroelectricity, nuclear fuel, and alternative energy sources;
The requisite transmission and distribution systems, and their finances; and
Issues related to retail pricing and collection in the context of our difficult legacy of unsustainable giveaways.

In addressing these, there are a couple of priorities suggested for the new government:

1. Infrastructure & Digital Access
The government seems serious about infrastructure. The PM's 10-point guidelines to his ministers begin with infrastructure reforms, mentioning health, water, education, roads, and energy as priority areas, with a separate mention of e-auctions for transparency.[1] Given this, one would expect that digital networks are an integral aspect of desirable infrastructure that provide people access to e-governance services. However, if digital networks are not mentioned specifically among the government’s priorities, their importance is likely to be lost in the ensuing activities. Meanwhile, the situation in the sector is complex and confusing, with conflicting demands from private sector contenders, state-owned operators MTNL and BSNL, I&B, and the Finance Ministry’s need for short-term revenues. This is why issues relating to communications infrastructure deserve to be addressed and resolved with high priority, and the government needs to explicitly recognise this.

2. Solar Power: Incentives & Promotion
A baffling aspect of our energy policies is why solar power has not become a centrepiece of our daily energy use. Much of the country gets so much solar radiation for most of the year that it should be an obvious focus for an energy-hungry developing economy. It should be possible, one would think (without knowing how simple or complex it would be to engineer the solutions), to use solar power when it is available, and grid power when it is not. The ministry of new and renewable energy had a scheme for partial capital reimbursement and soft loans for individuals and groups until the end of March 2014.[2] It doesn't appear to have been particularly successful.

Surely our priority should be to devise and implement schemes that actively encourage individuals and groups to invest in distributed solar generation for themselves? A long-term approach may require feed-in tariffs and grid modifications, as well as changes in administrative policies including taxes, to ensure (a) a significant increase in solar power (b) with more locally manufactured equipment. In the short term, an appreciable increase can result from enabling changes in rules and procedures, and the reimbursement of some capital costs combined with reduced excise and taxes.

The scope at the macro and micro levels is immense, encompassing multiple ministries that add up to a vast tangle, like an immense Gordian Knot. Add the other aspects of infrastructure, and the list seems endless: networks that are essential to enable e-governance and productivity through communications, transportation - e.g., rejuvenating the railways, disentangling the stalled process of building highways and roads, air and water transport, water supply and sewerage, and so on. All these have to be addressed within the constraints of the fiscal situation, inflation, restrained economic momentum, employment generation, budgetary limitations, and the reconfiguration of asset pricing to make financial returns attractive relative to property and gold without disrupting property values and the banking system. It will certainly help if our energies converge on the tasks focussed on realising the requisite goals, instead of being frittered away on disunity and fratricidal skirmishing.

Despite the daunting tasks ahead the prospects are solidly encouraging, because of a clearly mandated government. Another positive factor is the swing in votes favouring development over regressive caste and religious affiliations or hand-outs. This happened abruptly, without warning. If such tremendous change is possible so quickly, imagine what good leadership and honest governance could pull off with an inspired and supportive citizenry.

For more details visit https://cis-india.org/telecom/blog/organizing-india-blogspot-shyam-ponappa-june-5-2014-a-great-start-for-modi-government

A billion mobile users: new startup profiles and innovation insights from Mobile India 2016

praskrishna — 2016-01-17T15:13:42Z

The annual Mobile India conference, for which YourStory was the media partner, wrapped up recently in Bengaluru with a startup showcase and a wide range of insights on mobile innovation in India.

The blog post by Sneha Maselkar and Madanmohan Rao was first published in Your Story on January 14, 2016. Sunil Abraham was quoted.

Chaired by professors V. Sridhar of IIIT Bangalore and D. Manjunath of IIT Bombay, the event’s theme was ‘The App Economy.’ (See YourStory coverage of the earlier editions of this conference: 2015, 2014 and 2013).

Mobile innovators

New products were presented by innovators like Pravin Bhagwat, Founder and Chief Technology Officer, AirTight Networks. The company is creating an app store based on ‘social WiFi,’ riding on Google+ and Facebook. A number of interesting startups like IoTM2MSolutions were also at the event. Founded by Ismail Zabihullahh in 2009, the 15-member team has a range of offerings in home automation, RFID biometrics, street lighting and smart parking solutions.

Inaccel is a med-tech accelerator founded in 2014 by Siraj Dhanani, Vijayarajan and Dr. Jagish Chaturvedi. It address the needs, resource and skill gaps, and price-sensitivity of clinical markets, and helps startups conceptualise, design, engineer, and achieve regulatory certification. Its portfolio picks companies with a five-year horizon, in exchange for equity stakes.

Dataglen was formed in 2014 by Deva P. Seetharam, Tanuja Ganu, Sunil Ghai and Rajesh Kunnath. It provides Internet of Things (IoT) data collection and management services, and provides an API for users to develop applications on a variety of computing platforms. The startup charges for data management services based on the volume of transactions and for any required customisation services.

Czar Securities was founded in August 2013 by Shikhil Sharma and Ananda Krishna. Two employees Deepankar Tyagi and Nakul Gulati joined in quick succession. The cyber security solutions company secures corporate IT infrastructure from cyber attacks. Offerings include ASTRA, an intrusion prevention system, as well as penetration testing and security audit services.

Infilect was founded in April 2015 by Vijay Gabale and Anand Prabhu Subramanian. They are building an AI-enabled personalised fashion shopping assistant. The product, Photolect, helps in discovery, search and personalisation for online shoppers by parsing of photos. The product is in beta-test mode with several fashion experts evaluating its features.

Sattva Medtech was founded in 2014 by Vibhav Joshi and Sumedh Kaulgud. They are developing a next-generation fetal health monitoring device which leverages advanced sensors and algorithms. This device, called the Sattva Fetal Lite, has been designed and engineered for use in India and other low-and-mid-income countries; the team has raised an undisclosed amount in seed funding from InnAccel.

Coeo Labs was founded in October 2014 by Nitesh Kumar Jangir and Nachiket Deval. It is a medical device company, developing products in the field of emergency and critical care. Offerings include a device to reduce chances of acquiring ventilator-associated pneumonia (VAP), and a mechanical CPAP machine (mCPAP) for transport of neonates with troubled breathing, from a resource-constrained setting to a neonatal ICU.

IoT scenarios

Over a dozen experts from India and the US discussed the latest mobile trends in a day of packed panel sessions and keynotes. Interface design, usable security and systems integration are key success factors for IoT, according to Henning Schulzrinne, Professor at Columbia University, and CTO, United States Federal Communications Commission. Consumer and industrial IoT scenarios differ with respect to predictability, redundancy, energy consumption and interoperability.

He pointed out categories and uses cases of high IoT impacts: automation of manual data extraction (metering), remote maintenance (vending machines), extraction of additional information (thermostats) and software-defined mechanics (locks, switches).

“IoT networks won’t operate just on mobile carriers, but also on other networks such as Zigbee and Bluetooth,” Henning explained. The Internet itself will be transformed by IoT. “Protocols matter, programmability matters more,” he added. The Internet is becoming more than the Internet protocol; plug-and-play is becoming augmented by plug-and-programme in the IoT world.

The ‘DNA’ of apps

The proliferation of apps can lead to the rise of localised app stores in local languages, said Chinnu Senthilkumar, CTO, Exfinity Ventures, pointing to Korea as an example in this regard. “Many apps are local. How well do you know the digital literacy of your neighbourhood users,” he asked.

Most apps in India are of the ‘me-too’ type; developers need to incorporate better user experience (UX) and bring in more cross-disciplinary experience (see earlier insights from the UX India 2015 conference and NASSCOM NPC 2015). “Security is still an afterthought in app development,” cautioned Chinnu.

“You need to figure out the DNA of the mobile experience: Device, Network, App,” explained Amar Nagaram, Director, Mobile Engineering, Flipkart. The e-commerce giant classifies devices into four broad categories, and its app design factors in the app size, data stored on the device, and computational power of the device.

Battery requirements of the device and packet drop rates on mobile networks are major constraints on app performance in India. Online shopping lets users interact with catalogues as well as product experts.

“I had to unlearn a lot of things from the Internet world which may not apply in a similar manner to the app world. For example, not all older versions of apps need to be supported,” explained Amar.

“Ask yourself, what does your app do for consumers?” advised Pradeep Nair, Co-Founder and CEO, Confianzys. Developers should be looking not at product-market fit, but market-product fit. “Industries die because of their myopia; they focus on past products and not future consumer needs,” he said, urging developers to track-long term megatrends as well.

Telcos’ role in the App Economy

The telecommunications world is changing rapidly due to trends like IoT, new breeds of apps, video boom and Big Data, observed Ishwardutt Parulkar, Cisco Distinguished Engineer. Telcos are struggling to get new drivers for existing services, new revenue sources, and new sources of consumer loyalty.

“Telcos need to provide APIs to developers for embedding telco services and network analytics data. Telcos can also play a bigger role in mobile advertising, for example network-wide ad blocking, as in the case of Jamaica,” advised Ishwardutt. Telcos can exploit synergy with cloud services, and resell SaaS products bundled with telco products.

“We are witnessing major waves of disruptive innovation today: the rise from oblivion to the top is rapid – and so is the fall from the top,” said SR Raja, Associate Vice President, Persistent Systems. Many incumbents tend to suffer from ignorance, inertia, and the inability to do little more than tweak or tinker with existing offerings.

There is a Moore’s Law variant for all architecture components, including programming languages. Hence, telcos need to master new business models blending product and service, advised Raja. “Even regulated industries can be disrupted from outside – look at Uber and Tesla. Will telcos experiment with surge pricing like Uber, or become IoT solutions systems integrators,” he asked. For example, operator O2 has used mobile identity to launch its own messaging OTT app, and Vodafone is getting into IoT services.

Operators and Net Neutrality

The Mobile India conference took place with the backdrop of a heated battle over Net Neutrality between Facebook’s Free Basics and Internet activists from India, which has received a lot of media coverage in India and overseas.

This calls for the digital media community and entrepreneur ecosystem to pay attention to complex but important issues such as Internet governance. “The next billion users in India may be very different from the current billion, in terms of geography, language and access device,” observed Samiran Gupta, Head-India, Internet Corporation for Assigned Names and Numbers (ICANN).

ICANN’s objective is to maintain inter-operability of the Internet, and there is a unique opportunity for emerging economies to play a stronger role in Internet governance, in issues such as local languages and scripts.

Regulation and digital innovation

Regulators have major challenges ahead in juggling the needs of multiple stakeholders and demands for different slices of spectrum. “There are 43 different kinds of radio-communication services competing for spectrum,” said Pavan Garg, Former Wireless Adviser, GoI, and former Member, Radio Regulations Board, ITU, Geneva.

Regulators need to become much more savvy on the kind of collusions possible between industry heavyweights, according to Sunil Abraham, Executive Director, Centre for Internet and Society.

If India gets its IP regime correct, the local language content economy can be boosted, in addition to other civic benefits. For example, giving anonymised data access to independent researchers has helped LIRNEasia come up with better transportation design in Sri Lanka.

The discussion covered a wide range of interesting possibilities. In the EU, it is mandated that all mobile phones be able to display all European languages. Can India do the same for local languages? Will regulation promote support for Indic language technology on mobiles, or should this be left purely to the market? Organisations such as the Telecommunications Standards Development Society, India (TSDSI) is working on Indian language standards in ICTs.

The app economy can indeed be accelerated with proactive government intervention, said Parnil Urdhwareshe, Research Assistant at ICRIER and co-author of a report on ‘Impact of India’s App Economy.’ India’s app ecosystem could be worth Rs 2,000 crore in 2016; it created about 75,000 direct jobs in 2015, according to the report.

The government can pass regulations on apps covering privacy, Net Neutrality and safety, eg. SoS buttons, medical apps. The UK government has drawn up a range of app guidelines covering issues such as in-app purchases.

“Design in India is more important than Make In India,” said Vipin Tyagi, Executive Director, C-DOT, drawing attention to issues of participatory design and citizen-centric services rather than only one-way top-down initiatives from government and large industry players.

The road ahead

Broadband penetration in India is only 10 per cent. By 2018, video will be 62 per cent of India’s mobile data traffic, and there will be 526 million Internet users, according to Anil Kaushal, Member, Telecom Regulatory Authority of India (TRAI).

The government’s BharatNet initiative aims to connect 2,50,000 Gram Panchayats across the country. TRAI has given recommendations for Virtual Network Operators, wherein niche players can offer Smart City services.

In addition to regulators, operators and developers, success of the app economy also rests on responsible user behaviour, said Deepak Maheshwari, Head-Government Affairs, Symantec. “Be more active with respect to data encryption on your device. Use multi-factor authentication,” he advised.

Seventy per cent of India’s population lives in villages; digital innovation will help bring education and healthcare to them, said Vimal Wakhlu, Chairman & Managing Director, TCIL. There are also global extensions and markets for Indian innovations, such as the Pan-African E-Network targeted at 53 countries. There are major uses of ICTs across India, such as monitoring the cleaning of the Ganges as well as water gate management in Gujarat, Vimal added.

“India needs to mandate telecom infrastructure in real estate development and town planning. Digital media will change the way we learn and earn,” said T.R. Dua, Director General, Tower and Infrastructure Providers Association (TAIPA) India, and Co-Chair ITU APT Foundation of India.

For more details visit https://cis-india.org/telecom/news/yourstory-sneha-maselkar-and-madanmohan-rao-january-14-2016-a-billion-mobile-users

“OTTs Eating Into Our Revenue”: Telcos in India

geetha — 2014-09-10T05:36:37Z

On August 5, 2014, the Telecom Regulatory Authority of India organised a seminar on a regulatory framework for Over-The-Top services. This is a lay discussion of the Seminar and its focus on matters crucial to telecom, the Internet and the existing regulatory framework.

On Tuesday, the Telecom Regulatory Authority of India (TRAI) held a seminar to initiate discussion on potential regulation of “over the top” services (OTTs) in India. TRAI organized the seminar to “understand perspectives of all stakeholders involved”, following grievances of telcos that OTTs are eating into their revenues and free-riding on their networks. In fact, a letter from the Cellular Operators Association of India (COAI) to TRAI outlines these concerns excellently. The letter, which I had the opportunity to see in print, objects that telcos take the trouble of laying and maintaining networks, while rapidly mushrooming OTTs eat into their revenue. Whatsapp, Skype and alternatives to paid text-and-call find particular mention in the COAI’s letter, and the COAI President Vikram Tiwathia was vociferous in his iteration of operators’ concerns. With VOIP and other OTTs replacing telco services, telcos are rapidly losing large parts of their revenue, he said.

I don’t mean to brush their concerns aside, of course. However, there is a need to consider in depth certain questions with statistical, regulatory and principled exploration. As Dr. Rajat Kathuria of ICRIER said at the Seminar’s first session, we need to evaluate whether there’s a need for regulation in the first place. This includes exploring whether the answer lies in deregulation, as Suhaan Mukerji of PLR Chambers and Subho Ray of IAMAI emphasized separately. Our solution, as Mr. Ray said, should not be to chain the free OTTs just because we are in chains ourselves. Unchaining telcos from their stringent licensing and other regulations may be more appropriate.

The Seminar was attended by telcos, OTTs, civil society and other stakeholders, and the frank exchange of views at the PHD Chamber of Commerce was heartening. While telcos in the room were broadly open to OTT innovation upon their networks (Mr. T.V. Ramachandran of Vodafone was particularly vocal on this), there exists a broadly reactionary loss-of-footing and apprehension over their current and projected revenue loss. Mr. C.S. Rao of Reliance was spot on when he said that telcos are afraid that what’s worked for them so far may not work in the future.

We’ve seen examples of such fear of incumbent operators before. In the early 1990s, the invention and spread of the Internet displaced appliancized, bundled models of telco services, and telcos were similarly unwelcoming. Indeed, AT&T went to court to fight the introduction of the Carterfone. In India, the falling demand for VAS today, and OTT-response to consumer demand, fosters such fear.

But accounting for OTTs’ lack of consumer servicing or responsibility for monetization models, what was of chief concern at the TRAI Seminar was the predominant focus on revenue. Telco profitability and their incentives for investment are important. Increasing supply side costs, with the government seeking to maximize revenue from spectrum allocation and demands of lower consumer prices, might be throttling current telco business models. We’d need to analyse data usage charges and projected mobile broadband penetration, in comparison with voice penetration, to be clear about the extent of such strangulation. But if the answer to failing telco business lies in further regulation and potential strangling of innovation, that’s a concern.

That’s in two ways. First, it isn’t merely the NetFlix or Google or Apple that populate the app economy. Raman Chima (ironically of Google) offered the example of Slideshare in Okhla, Delhi as one of the many successful Indian micro-multinationals. There are many others across India. Second, India’s current telecom regulatory model is unfit for a data/Internet content model. There’s a need, Suhaan Mukerji and Mahesh Uppal of ComFirst pointed out, to rethink our strict telecom licensing regime. We should begin to think, at least, of a vertically integrated layered model of telecom regulation that regulates on the basis of function.

These layers are integral to Internet architecture: network, transport, application. OTTs lie at the application layer, while telcos operate at the network and transport layers. It may be inefficient to utilize failures at one layer to regulate or share revenue of companies at other layers – that would stunt competition and innovation. A reconfigured licensing regime, permitting telcos to innovate more (someone at the Seminar said security clearances take years, while OTTs need no such clearance) might be more efficient and beneficial for all stakeholders involved – not least the disempowered individual consumers.

That’s my sense of the Seminar. Profitability and incentives are crucial. But they are crucial insofar as they benefit consumers – with access, choice, freedom of speech, security and privacy. Revenue sharing or partnership models, which were mentioned far too many times by multiple speakers without sufficient justification or elaboration, may not be ideal for any of us in the long term. But these are issues we – and TRAI – should consider while debating a regulatory framework.

Underlying infrastructure has an impact on our fundamental freedoms such as speech – the Supreme Court’s decisions in Sakal Papers and Express Newspapers makes that clear. Fast-paced innovation and the boundary-less benefits of a single, interoperable Internet have pushed us to favour security against freedoms. But every model we consider today – ad-based monetization, big data analytics – have implications that the NSA’s mass, cross-border surveillance has highlighted. Since TRAI is rethinking our regulatory framework for telecom and the Internet – and I envisage this going into a constructive consultation in the near future – these issues must inform its analysis and conclusions.

For more, read Nikhil Pahwa’s report over at MediaNama.

For more details visit https://cis-india.org/telecom/blog/otts-eating-into-our-revenue-telcos-in-india

22 nieuwe leden voor Partnership on AI

praskrishna — 2017-05-19T06:54:20Z

Partnership on AI, een non-profit organisatie ter bevordering van het algemeen begrip van kunstmatige intelligentie en de ontwikkeling van best practices, heeft 22 nieuwe leden aangekondigd.

The news was published by Telecom Paper on May 17, 2017.

Tot de nieuwe leden behoren eBay, Intel, McKinsey & Company, Salesforce, SAP, Sony, Zalando, Cogitai, Allen Institute for Artificial Intelligence, AI Forum of New Zealand, Center for Democracy & Technology, Centre for Internet and Society – India, Data & Society Research Institute, Digital Asia Hub, Electronic Frontier Foundation, Future of Humanity Institute, Future of Privacy Forum, Human Rights Watch, Leverhulme Centre for the Future of Intelligence, UNICEF, Upturn, en de XPRIZE Foundation. Partnership on AI werd vorig jaar september opgericht. Tot de oprichters behoren onder meer Amazon, Facebook, IBM, Microsoft, Google DeepMind en Apple.

For more details visit https://cis-india.org/internet-governance/news/telecom-paper-may-17-2017-22-nieuwe-leden-voor-partnership-on-ai

5G Technologies Workshop by IEEE

rohini — 2015-08-29T14:10:03Z

The workshop was organized by IEEE Communications Society, Bangalore Chapter, at Bangalore on May 22 and 23, 2015. Rohini Lakshané attended the workshop.

Download the programme schedule

For more details visit https://cis-india.org/telecom/news/5-g-technologies-workshop

5G Aspirations and Realities

Shyam Ponappa — 2019-07-02T04:29:22Z

What the government can do for 5G and Digital India with a Systems Approach.

The article by Shyam Ponappa was published in Business Standard on June 6 and in Organizing India Blogspot on the same day.

Ah, 5G! The very thought seems to excite so many. What is it? It is a mix of telecom technologies¹ delivering much higher data speeds on more extensive connectivity, using much lower power, with extended battery life, and emitting less radiation, for ways to connect and operate most of the conveniences people use regularly. From smartphones and computers for communications, study, work, research, entertainment, to other devices and machines, such as for managing utilities (electricity and water) at home and the workplace, refrigerators and cooking devices, industrial equipment, transport, and more, so that daily activities are eased considerably. The catch is that 5G is at an early stage in a long process — perhaps a couple of years to manifest in large trials in India, and several more years to be widely available, needing huge investment ($100 billion in India).

Yet, there are compelling reasons for developing India’s capabilities. There is the sheer necessity for India to partially meet its requirements, instead of relying entirely on imports. The big draw is the size of the Indian market and prospective demand, the global market, and the possibility of innovation at this early stage. Domestic capabilities are a prerequisite to afford deployment at a level that would otherwise exceed petroleum imports, with unsustainable effects on our balance of payments. Without domestic capacity, energy imports would limit electronics imports. (This highlights India’s need for solar power development, a separate and equally high priority.)

However, the sobering financial condition of India’s communications industry gives pause. Financial capacity — revenue generation and access to capital, both equity and debt at favourable terms — is required to develop capabilities. After the telecom price wars, even Reliance Jio is reportedly cutting staff. Airtel, meanwhile, having invested heavily in 4G infrastructure, has stated its unwillingness to bid for 5G pectrum unless prices are lower.

The government set up a committee for 5G in September 2017 with a steering group chaired by emeritus professor at Stanford Arogyaswami Paulraj, a pioneer in wireless communications. This committee recommended network deployment as the immediate priority, i.e., rolling out early, efficient and pervasive 5G networks. Technology design and manufacturing capacity were recommended for later phases.

Network deployment needs policy support driven by a Systems Approach, especially for a debt-encumbered sector faced with declining revenues per user, and unused, inaccessible spectrum, even as other countries enhance their lead. This is ironic, because India has real strengths in this sector and a large market, with the potential to catapult productivity and prospects. Yet, government policies have not succeeded in coordinating our reservoir of human resources and potential.

India lags in 5G despite the government’s stated interest in establishing a lead. Spectrum allocation and large trials were scheduled towards the end of 2019, and auctions in 2020. However, government statements this week target 5G trials by September, and auctions by the end of 2019. As spectrum band choices and allocations for trials have yet to be made, this appears overambitious without radical improvement in resolving many such issues.

Also, India’s reserve price for spectrum is seven times Korea’s. As sectoral cash flows are weak, there may be takers only at very low prices unless funding is from external sources as for Reliance. A monopolistic outcome would be undesirable in the public interest. Therefore, shared access with Wireless Resource Virtualisation and Network Function Virtualisation may be a much better solution for network deployment and market development.

Inexplicably, government and the public still view communications as a “government cash-cow” instead of as critical infrastructure, while complaining bitterly about poor delivery from low investment. It is obvious that exorbitant government charges (29-32 per cent of revenues plus corporate tax) crowd out investment. The government can change this, or give up on establishing a lead in communications and 5G. Worse, India will continue to lose out on leveraging communications for development.

Initiate a breakthrough - Apply Systems Thinking

The government can catalyse a breakthrough by doing the following:a) Reduce borrowing costs and taxes for communications as infrastructure. This aim of the National Telecom Policy 2012 (NTP-2012) has been ignored.b) Provide adequate spectrum aligned with global allocations. Given India’s low fibre penetration and need for digital technology, allow shared access to all spectrum and infrastructure, with charges for usage based on revenue sharing.c) Clear administrative impasses through coordination and due process without delay. For example, allocate spectrum immediately for 12 months for trials.Many countries have completed 5G spectrum assignments and are already deploying 5G. These include Korea, Switzerland, Finland, UK, USA, Canada, Australia, Germany, Russia, Italy, and Japan.²There are nearly 300 5G deployments, as shown on an interactive map on Ookla’s site (Chart 1).
Chart 1: 5G Map – June 4, 2019

Source: https://www.speedtest.net/ookla-5g-map
In this context, Huawei’s role in India is contentious. One issue is of non-discriminatory trading terms, or fairness in competition. If an entity such as Huawei achieves global dominance through government support, it competes on terms that cannot be matched because of cost of funds and scale advantages. Such entities can establish dominance in any country against competitors who do not enjoy similar support. Second, while Huawei may be doing nothing different from Nokia or Ericsson, the fact that it is supported by a neighbour with apparently hegemonic behaviour, China, suggests that dependence or entanglement are inadvisable.

To succeed with Digital India and 5G, government can begin by classifying communications as infrastructure, and adopting the approach taken for 5 GHz Wi-Fi. Take pointers from the US FCC, ETSI, and so on; use spectrum and network sharing to leverage equipment and spectrum fully; support local technology champions such as a fabless chip design unit and a network equipment manufacturer in Bangalore, and a wireless equipment manufacturer in Delhi; and focus only on delivery with sustainable revenue generation.

Shyam dot Ponappa at gmail dot com

1: 5G technologies include Multi-User – MIMO (MU-MIMO) to improve reception, small cells for better performance and reduced radiation, WiGig and other high-speed wireless technologies, Software Defined Networks with Network Function Virtualisation, Wireless Resource Virtualisation, and a fibre backbone.

2: Page 8: https://img.lightreading.com/5g/downloads/ webinar-breaking-the-wireless-barriers-to-mobilize-5g-

For more details visit https://cis-india.org/telecom/blog/shyam-ponappa-business-standard-june-6-2019-5g-aspirations-and-realities

3rd IJLT-CIS Lecture Series at NLSIU, Bangalore

praskrishna — 2012-05-25T15:33:16Z

The Indian Journal of Law and Technology in association with the Centre for Internet and Society, Bangalore is organising the 3rd IJLT-CIS Lecture Series at the National Law School of India University, Bangalore. The lecture series will be spread out over the course of the year and will include eminent speakers who will talk with the students and other interested persons on their topics of expertise.

To kick off the lecture series, Professor Rohan Samarajiva will deliver the inaugural lecture on Tariff Regulation in South Asia.

Tariff regulation has in the recent past attracted the attention of the Telecom Regulatory Authority of India and the Telecom Dispute Settlement Appellate Tribunal, as well as the Department of Telecom at the Union Ministry of Communications. India has a burgeoning and competitive cellular services provider market, and tariff regulation has far-reaching impact on the industry. Moreover, as aware consumers of mobile telephony and data services, this is an issue that is relevant for all of us.

Prof Samarajiva is a pre-eminent figure in policy-making and academia on the subject of information and communications technology, and this is an excellent opportunity to get his insights on the crucial topic, not just from an Indian perspective but from a pan-Asian viewpoint. He has taught at universities in USA, Netherlands and Sri Lanka and is currently Chairman & CEO, LIRNEasia, an ICT policy and regulation think tank active across 12 emerging Asian economies. He is also a Board member at Communication for Policy Research - South, which is a capacity building initiative to develop Asia-Pacific based policy initiatives on ICT policy regulation among junior to mid level scholars. His full profile can be accessed here.

The lecture will be organised at NLSIU, Bangalore on Sunday, the 27th of May, 2012 from 5.30 pm to 6.30 pm. You are requested to take your seats by 5.20 pm. The hour-long session will include both a lecture and an interactive session with the speaker. Interested persons are requested to register for the lecture series by sending in an email to editorialboard@ijlt.in

The address of the venue is

National Law School of India University
Jnanabharati Road, Nagarbhavi
Bangalore - 560072
Google maps location: http://g.co/maps/ppwcr

Follow our event page ‘3rd IJLT-CIS Lecture Series’ on Facebook to remain updated!

Download the event poster [PDF, 57 kb]

For more details visit https://cis-india.org/telecom/ijlt-cis-lecture-series-nlsiu

'Containing Inflation' - A myth

Shyam Ponappa — 2012-05-10T10:30:56Z

We need problem-solving, not confused rhetoric or misguided action, says Shyam Ponappa. The article was published in Business Standard on 7 August, 2008.

It’s as if there’s a conspiracy to beat India’s growth surge to pulp, making sure the economy is hamstrung in the months and years ahead. Those of us seeking rational signals in the economy have watched incredulously as the cost inflation from edible oil, food and energy was misconstrued as overheating from 2006, leading to a series of misguided, self-destructive steps. Moreover, there has been a baffling obscurantism spread by many different quarters — the RBI, the Finance Ministry, and many economists including from the private sector, the media and press — spouting irrational sophistry about the need for the sledgehammer of rising interest rates “to contain inflationary pressures”.

Mutterings about the pass-through of international energy prices are of a piece. The effect of pass-throughs is to increase inflation further, and unlikely to reduce short-term demand (i.e. control inflation), unless the increase is so large that the economy slumps because of a drop in demand.

The build-up with the convoluted explications started with the RBI’s nagging suspicion [sic] in October 2006 that there “could be elements of overheating in the Indian economy”. This led to the hike of the repo rate from 7 per cent to 7.25 per cent, making financing more expensive in the Indian economy. By December 2006, the RBI raised the cash reserve ratio (CRR) by 50 basis points to reduce inflationary pressures, and by the end of January 2007, raised the repo rate to 7.5 per cent citing the demand-supply mismatch in food. By March 2007, the repo rate was raised to 7.75 per cent and the CRR by 50 basis points to 6 per cent citing continuing inflationary pressure. In June, the repo rate was raised to 8 per cent.

The benefit of hindsight makes it evident to all of us including the RBI and the government that these measures have done nothing to improve the supply of food or edible oil, or for the surge in petroleum prices. Inflationary pressures are expected to continue into 2009 despite these actions that have slowed the economy. So, what is the purpose, other than reducing growth precipitously? All that increasing rates and financing costs will do is to kill India’s growth story. This shows clearly in the figure in the slowdown from 2007 in GDP growth and in the Index of Industrial Production.

Increasing rates can only curb inflation by reducing growth so much that demand is curtailed for those whose ability to buy food increases because of higher earnings. That’s what the obfuscatory talk of “containing demand” boils down to: forcing the economy to slow so that some people can afford to buy less food. It is also clear that by increasing demand through the loan waiver and NREGS without addressing supply constraints, the government’s actions increased inflationary pressures. Likewise if the Pay Commission recommendations are implemented now instead of delayed for a year.

What rising financial costs have done to the Indian economy is to vaporise all prospects of high growth and profits. Further aggravated by the global slowdown and the repercussions of the continuing meltdown of home loans and overleveraged US consumers, this has reduced the prospects of currency inflows that have so far provided a ballast to India’s dream investment run.

Corrective Actions Require Substance, Less Form: The government and RBI could take a constructive, problem-solving approach to growth, inflation, interest and exchange rates, provided their purpose is solution-oriented and not a preoccupation with appearing to take action. These involve (a) avoiding gamesmanship — loan waivers, NREGS, the imperfections of the PDS — and addressing more effectively (b) fuel taxes and pricing, and (c) supply and distribution.

The first step may be to acknowledge that in the short term, there is little that can be done to ameliorate high food prices with one exception, while taking measures to improve supply over the medium and long term. The exception is interim steps to help the poor through food coupons that enable direct subsidies through existing retail systems.

Over the medium term, a system using smart cards needs to be planned and implemented through the retail network that provides direct subsidies for food and fuel to lower-income users. On fuel, there has to be a concerted move to reduce taxes and remove anomalies in petrol and diesel pricing (i.e. subsidising private vehicle owners, inappropriately encouraging the growth of small diesel vehicle manufacture and sales).

Equally important, we have to learn to take the good examples of applied research and extension to make them more of a reality. It’s as simple or as difficult as getting good applied research work done in the field, and providing convincing extension support to local farmers. I had the opportunity recently to review an excellent instance of applied research, combined with sound extension practices that ensure supplies of fresh vegetables wholesale, organised and channelled flawlessly.

Of course, unique aspects make this not easy to replicate. The first is a well-managed farmers’ cooperative. This was organised in Ladakh by the late Rigzin Namgyal Kalon of Leh with great foresight, integrity and ability some 40 years ago. Mr Kalon had the ability to see how farmers could prosper by organising themselves for supplying farm produce to the sizeable army presence in Ladakh. When Mr Kalon passed away in 2002, his peers had the good sense to appeal to his family to continue to lead their effort. The second is a wholesale buyer (the Army). The third is the presence of an institute engaged in effective applied research in agriculture, horticulture and animal husbandry in Ladakh. Started as the Field Research Laboratory under the Defence Research and Development Organisation, this is now the Defence Institute of High Altitude Research. This combination of elements provides the ingredients for a winning formula for the farmers of Ladakh.

Here are object lessons for those who see the potential for cooperatives, but think it cannot work in India. After all, there is Anand (the Gujarat Cooperative Milk Marketing Federation Ltd) and its extension to the National Dairy Development Board to prove that it can be done. We have to stop thinking of shortcuts, learn to replicate these ways, and teach ourselves to collaborate.

Read the original in Business Standard

For more details visit https://cis-india.org/telecom/blog/containing-inflation-a-myth