Telecom and Rural India: The Story So Far

Aditya Kumar . January 5, 2011

Despite the apparent explosion in the use of mobile phone technology, only a small percentage of the rural people have gained from its use; the challenge lies in reaching out to this vast untapped section of society, through ways that take into consideration their ground realities-their needs, strengths and limitations

Despite the apparent explosion in the use of mobile phone technology, only a small percentage of the rural people have gained from its use; the challenge lies in reaching out to this vast untapped section of society, through ways that take into consideration their ground realities-their needs, strengths and limitations

A ccess to technology in rural areas has always been problematic, especially telecommunication. Despite the tall claims of Indian telecom operators of India being one of the most lucrative markets of the world, the rural Indian market is in a sad state of affairs when it comes to mobile phone connectivity. By the end of March 2010, India had 584 million mobile subscribers. This accounts for 53 per cent of the total Indian population. However, if we look at the distribution of the mobile subscribers across India we find that 81 per cent of the total number of mobile subscriptions are in the cities, including the metros and the tier 2 and tier 3 cities. The contribution of mobile subscribers from the rural areas is a dismal 19 per cent of the total subscribers whereas the rural population forms 72 per cent of the total Indian population. This means that 28 per cent of the total population contributes to 81 per cent of the total number of mobile subscriptions. And despite almost three-fourths of the population being oblivious about mobile communications, we claim to be the telecom giants of the world.

The government recently auctioned the 3G spectrum with an expectation of raising Rs 35,000 crores. It was in a surprise when the auction brought in Rs 67,710 crores. 3G has been pitched by the government as the gap filling technology that will help provide access to various mobile services to the rural India. In order to understand the impact of 3G and analyze it, we must understand the following terminology first.

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