Broadband on WiMAX: Technology Delivery vs. Market Needs


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  • Online travel currently $1bn in size (gross)
  • Broadband on WiMAX: Technology Delivery vs. Market Needs

    1. 1. Broadband on WiMAX Technology delivery vs. Market needs Prateek Pashine March 17, 2008
    2. 2. Huge Latent Demand Population 1.1 billion Urban Population 300+ million Mobile Phones 250 million Cable & Pay TV >60 million Fixed Lines 40 million Broadband Subs 3.2 million Internet Subscribers 8-9 million Internet Users 40-50 million
    3. 3. Market View <ul><ul><li>2010 forecast of subscribers as a % to other durables owning households is very conservative </li></ul></ul><ul><ul><ul><li>4.01% of Mobile subscribers </li></ul></ul></ul><ul><ul><ul><li>14% of Households with Income of >91,000 </li></ul></ul></ul><ul><ul><ul><li>24% of CTV households </li></ul></ul></ul><ul><ul><ul><li>27% of Motorcycle owning households </li></ul></ul></ul><ul><ul><ul><li>34% of Refrigerator owning households </li></ul></ul></ul><ul><ul><ul><li>83% of Car owning households </li></ul></ul></ul>
    4. 4. Markets That Broadband Services Can Impact Media & Entertainment Size ($ Bn) Growth (%) Training & Education Organized Retail 12 18% Current Online Share (%) ~1% >20 10-15% ~0% 10 50% ~0% Even a 1% share of these 3 sectors could create a Broadband services market of over $10Bn in 5 years
    5. 5. Learnings from the Mobile revolution!
    6. 6. Mobile Subscriber Growth – Driven by Competition and Falling Tariffs Source: TRAI, COAI, AUSPI Mn Subscribers NTP ‘99 : Introduction of Revenue Share Entry of 3 rd and 4 th GSM Operators Entry of 2 pan-India CDMA Operators “ Calling Party Pays” Introduced CDMA Limited Mobility Entry WLL introduced Rs. Per minute
    7. 7. Key Growth Drivers In Mobile <ul><li>Market and Reach </li></ul><ul><ul><li>Favourable demographic shift in Indian households </li></ul></ul><ul><ul><li>Increasing coverage by telecom operators </li></ul></ul><ul><li>Cost to serve </li></ul><ul><ul><li>Decreasing costs of services for end consumer </li></ul></ul><ul><ul><li>Decreasing Handset and device costs </li></ul></ul><ul><ul><li>Lower incremental capex per capacity </li></ul></ul><ul><li>Regulation </li></ul><ul><ul><li>Decreasing regulatory uncertainty </li></ul></ul><ul><ul><li>+ve changes including Reduction in License Fees and other costs </li></ul></ul>The robust growth of Indian Wireless Telecom Industry is driven by several factors which initially remained key hindrances
    8. 8. Connectivity needs of tomorrow’s household <ul><li>Voice services largely met by Mobile (GSM/CDMA) </li></ul><ul><li>DTH and Cable networks to cater to the Entertainment needs of the household </li></ul><ul><li>VoBB to deliver rich voice along with Video Voice </li></ul><ul><li>So what will Broadband provide? </li></ul><ul><li>Reliable always-on Internet connection </li></ul><ul><li>Deliver on-demand streaming video </li></ul><ul><li>www </li></ul><ul><li>Networked applications and services </li></ul><ul><li>IPTV?? </li></ul>
    9. 9. Broadband Enablers
    10. 10. The Broadband Enablers Broadband Triangle Utility Device Infra Content & Apps International Domestic City Last mile Access Import procedures Open standards
    11. 11. Key Issues Preventing Broadband Growth <ul><li>Wire line last mile domination by PSU incumbents & Local Cable Operators (LCO’s) </li></ul><ul><li>While regulator recommended LLU, Govt. has not gone ahead </li></ul><ul><li>LCO market which control the cable last mile is highly fragmented with over 100,000 LCOs across the country; </li></ul><ul><li>The current cable TV network is arial and of low quality, backed with the lack of organization makes it difficult to upgrade </li></ul>Access <ul><li>Difficult in getting municipal support and clearance for getting right of way to lay copper/fiber lines </li></ul><ul><li>Spectrum policy for Broadband Wireless Access is yet to be finalized. </li></ul><ul><li>ISPs not permitted to offer domestic Internet Telephony (VoIP) </li></ul>Lack of Clarity - Government Policies
    12. 12. Bypassing Legacy – The India Way <ul><li>Voice Services : Digital mobile is 5X of fixed lines </li></ul><ul><ul><li>GSM introduced in 1995 and CDMA-1X in 2003 </li></ul></ul><ul><ul><li>No analog. No standards issues </li></ul></ul>Broadband ??? <ul><li>Pay TV Services: Satellite leading the introduction of digital TV </li></ul><ul><ul><li>Analog cable prevalent since mid nineties </li></ul></ul><ul><ul><li>Government mandates “conditional access” in metros </li></ul></ul><ul><ul><li>Satellite (DTH) services achieve 5% share in a year… 3 new players entering the market </li></ul></ul>
    13. 13. Wimax in India
    14. 14. Wimax – First Off The Blocks <ul><li>3G - Policy yet to be finalized </li></ul><ul><ul><li>Spectrum to be auctioned to 3-4 players </li></ul></ul><ul><ul><li>Greater impact on voice economics rather than data services </li></ul></ul><ul><li>WiMAX – Available now </li></ul><ul><ul><li>ISPs using 3.3GHz spectrum for WiMAX roll-out </li></ul></ul><ul><ul><li>At least 3 networks being built in all large towns </li></ul></ul><ul><ul><li>Best spectral efficiencies </li></ul></ul><ul><ul><li>Already a 4G technology – OFDMA today </li></ul></ul><ul><ul><li>Cost of CPE becomes indirect </li></ul></ul>20 mn subs projected by 2010 Promising technology option - need catalyst to fuel the deployment
    15. 15. India: Epicentre Of WiMAX <ul><li>Operators deploying WiMAX at 3.3 GHz </li></ul><ul><ul><li>China :: TD – SCDMA </li></ul></ul><ul><ul><li>Korea :: WiBRo </li></ul></ul><ul><ul><li>Japan :: J-CDMA </li></ul></ul><ul><ul><li>Asian tigers :: Do they follow standards or do they set standards </li></ul></ul><ul><li>Wireless Broadband opportunity in India bigger than </li></ul><ul><ul><li>Entire LatAm (predominantly on 3.5 GHz) </li></ul></ul><ul><ul><li>Korea (at 2.3 GHz) </li></ul></ul><ul><li>Current deployments by Indian operators rival the deployment of the “Poster boys” of WiMAX </li></ul><ul><ul><li>Tata Communications deploys the largest WiMAX network in a city across the world </li></ul></ul>
    16. 16. Pros and Cons of deploying 3.3 GHz <ul><li>Pros </li></ul><ul><ul><li>Spectrum will always be an issue in India – no spectrum is bad spectrum </li></ul></ul><ul><ul><li>Large market available in the country </li></ul></ul><ul><ul><li>Spectrum available with 7 to 8 operators </li></ul></ul><ul><ul><li>Speed to market due to product availability </li></ul></ul><ul><ul><li>Change the “growth curve” in 2008 to bring BB back to track </li></ul></ul><ul><li>Cons </li></ul><ul><ul><li>Very few other countries with 3.3 </li></ul></ul><ul><ul><li>Economies of scale benefit may not accrue </li></ul></ul><ul><ul><li>Roaming will be difficult unless multiple radios and channel sizes catered to by CPEs </li></ul></ul><ul><li>For a market like India, how critical is Roaming when basic connectivity is currently an issue </li></ul><ul><li>Don’t we have enough volumes and muscle power to get the best price points and eco-system developed? </li></ul><ul><li>Would WiMAX in immediate to near future be able to cater to roaming/mobile requirements vis-à-vis 1X/EVDO with 7000 town coverage in India? </li></ul><ul><li>Do we really have to look at the icing when cake itself is not present </li></ul>
    17. 17. Learnings and our experiences in this Journey Yes, we can give you “d” equipment at 3.3 “ What is 3.3 Ghz Wimax??!!!” Industry Reactions Tata Comms action Deploys/deploying largest “d” network Yes we will publish IOT and share data for HL integration What do you mean by independent CPE in “d” ? TC ready to place orders with atleast 2 independent CPE with full integration 3.3 e yes but at 5 Mhz >> 3.3 e at 3Mhz also 3.3 e!!! – come back after “don’t know how many months” RFQ floated and trials carried out in 3.3e
    18. 18. Crystal Gazing…India market….circa 2014 <ul><li>Largest WiMAX subscribers in India :: 20-25 mn subscibers </li></ul><ul><li>WiMAX contributing to 60+% of all Broadband connections </li></ul><ul><li>5-6 networks each having 60/70 Mhz spectrum </li></ul><ul><li>700 Mhz, 2.3, 2.5 and 3.3 Ghz networks live in “e/m” </li></ul><ul><li>3 Mhz, 5 Mhz and 10Mhz profiles deployed in India – adaptive channel size selection </li></ul><ul><li>ARPU of Rs 500 </li></ul><ul><li>4 radio CPEs available at Rs. 500 </li></ul>In Summary, India promises to repeat the Mobile revolution in broadband as well through WiMAX
    19. 19. Tata Communications – Taking Broadband to the masses with Wimax
    20. 20. Thank you
    21. 21.