According to the Department of Telecommunications, the country needs to lay over four times more OFC from the figure of 1.4-1.5 million cable route kilometres in 2018 to around 5.5 million cable route kilometres in 2022. A substantial part of the investment has to come from the government. The investment tab: over Rs 180,000 crore.
But telcos say their money will be spent primarily in putting fibre backhaul in towers. “We think that in the next two to three years, the number of towers will go up from 500,000 to 750,000 as 5G will be offered in bigger cities initially. To fiberise 70 per cent of them would require about Rs 50,000 crore,” said Rajan Mathews, director general of the Cellular Operators Association of India.
India’s per capita fibre infrastructure is woefully inadequate at merely 2.4 per cent compared to 19 per cent in China or 19.3 per cent in the US. Similarly, the OFC deployment in fibre kilometres is a tenth of that in China and half of that of the US.
So why do we need so much OFC? One key reason is the advent of 5G which simply cannot happen without a huge increase of the OFC infrastructure. For one, most of the spectrum needed for 5G service is in the higher frequency. The range of this spectrum coverage is, however, limited though it can offer very high speeds. This means more towers are needed than ever before. “We reckon that for 5G the number of cell sites which will be required is three times more than 4G because of the shrinkage in areas of coverage of the towers with high bands. So that much more fibre will be required,” said Mahendra Nahata, chairman of Himachal Futuristic Communications, a leading manufacturer of OFC.
The second reason is the need for tower backhaul. According to estimates, only 20 per cent of existing towers are fiberised and use microwave communications. In contrast, over 75-80 per cent of China’s towers are fiberised. The Indian figure, Mathew argues, should go up to 70 per cent in the next three years to support a reasonable 5G service.
But it is not only telcos who will spur fibre growth: demand is also coming from an increasing number of data centres being set up by global players, especially after the government made it mandatory for Indian consumer data to be stored within the country.
“They require a high capacity of fibre and also multiple connectivity because of fear of fibre cuts which is very high in India. So that means a lot of fibre,” said a senior executive of a data firm.
The third reason for fibre is the massive deployment of fibre-to-the-home started by Reliance Jio and, on a smaller scale, by Bharti. In what is one of the largest deployments in the world, Jio is simultaneously laying fibre across 1,600 cities and wants to reach 75 million households with FTTH services offering TV, voice, and data in three years.
Apart from the private sector’s hunger for fibre, the Centre has ambitious plans under the National Broadband Mission to take high speed data communications to rural India.
The big play of the central government is BharatNet which has been rolled out with the target of providing 1 GBPS of data by 2020 and 10 times more by 2022. But the project has suffered numerous delays and questions have been raised about its poor functionality.
States such as Telangana are also moving in. Telangana has launched T–fibre which aims to offer affordable broadband to over 20 million people and in 12,700 panchayats.
Said Ankit Aggarwal, CEO, of Sterlite Technologies: “We are seeing states also playing a role in building fibre networks and even looking at public private partnerships. Also, demand will come from smart city projects in cities.”
Yet fibre players are facing serious challenges, the most serious of which is getting “right of way” (permission to dig underground) from municipalities to put in the cables.
Telcos says the charges, which range as high as Rs 1 crore for a kilometre in cities like Mumbai, is a hundred times the cost of the OFC for the same distance. They say the average cost of cable and fibre is not even more than 15 per cent of the total cost of laying it under ground. The result is that deployment is both prohibitive and very slow.
Another issue is whether highly indebted telcos have the cash to pay for laying down fibre, buying expensive 5G spectrum, and also investing in rolling out 4G across the country.
The three telcos are already spending Rs 100,000 crore this year to expand their network. “Whether the telcos have the money to spend another Rs 15,000 crore on investing in fibre is anyone’s guess,’ said Mathews.
On funding, questions are also being asked about where the government will get the money to implement its ambitious targets which some critics say are out of sync with reality.