Broadband in India: Operating Expenses
Check other articles in the series...By Sujai Karampuri, Guest Author
As I discussed in the previous post, the drivers for penetration of broadband in India will be-
* Decreasing cost per line
* Decreasing operating expense
* Decreasing cost of PC (or similar device)
* Social attitudes and habits embracing broadband facilities
* More Indian content
In this post, I will analyze the decreasing operating expenses.
Look at who is going to provide the bulk of broadband services in India. They are all major operators who already have cellular and landline networks. While laying out the WiMAX networks, those operators will combine the operations with the existing operating premises thus incurring marginal increase in costs while deploying and managing wireless broadband services.
We will see more and more infrastructure sharing between various operators which was completely absent till now. Especially, in rural networks, this infrastructure sharing will turn out to be mere common sense. The operators who own the spectrum will resell the spectrum to other smaller players who will mushroom in various parts of India to cater to non-metros. The towns and villages may not be very attractive to some operators right away and they may like to sell this franchise or sell these frequencies to smaller WISPs and operators. Also, the coming of Virtual Network Operators will add to competition.
This segment is part 3 in a 5 part series PC & the Society →
Jump to part: India, Cost Per Line, Operating Expenses, PC & the Society, Local Content
I believe any vendor can keep a cap on his operating expenses if and only if he is very much sure about his target market.
If i know that, my target market can only pay Rs 2-3 for my service, then i will force everybody supplying me components or services to reduce costs, so that i can deliver the final product within the target price and still be profitable.
Vendors and Service providers have to completely rethink their strategy