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TECH TALK: India Internet and Mobile: Connecting Indians (Part 2)

February 10th, 2006 · No Comments

The opportunity in India of addressing the Internet and mobile needs of the tens of millions of users thus lies around the twin tracks of providing an Internet computing infrastructure for the next 100 million users, and building a content and services platform for them so that urban users can (among other things) alleviate lifes daily inconveniences and rural users can increase their incomes. How do we build this out?

Let us start with the Internet computing infrastructure. To bring the benefits of the computer to the mass market, we need to reinvent computing in a world where broadband exists. This solution needs to address the ADAM problems of computing. This is where the computer industry needs to learn from the mobile industry by providing an access device that requires zero-management and is affordable, and by a pay-as-you-go business model. In other words, computing has to become a utility in India with pricing along the lines of what people pay for their mobile services every month.

This can be accomplished with the use of a network computer, a broadband connection (wired, over DSL), and a computing grid at the telephone exchange which provides both the applications and data storage for users. This grid is then connected to the Internet over fibre. Between the home and the telephone exchange, it is possible to get 512 Kbps-2 Mbps connectivity using DSL today. From the telcos point of view, this is free bandwidth there is no operating expense once the capital expenditure is done. There are 45 million phone lines in India, of which about half could support this kind of access.

The network computer would cost about Rs 7,000 ($150). The DSL modem and telco equipment would cost about Rs 2,500 ($55). The fractional cost of the computing grid per user would be about Rs 500 ($11) for near-unlimited computing and storage. Thus, for a total capital expenditure of about Rs 10,000 ($220), it would be possible to equip a home with a managed computer and broadband access. Taken over a four year period and accounting for financing charges, the monthly costs would be about Rs 250 ($5.50). Add to this the monthly broadband access fee that operators charge (Rs 200) and an applications fee of Rs 50, it should be possible to put the entire solution together for about Rs 500 ($11) per month per user. This is the price point at which home Internet access will take off.

A similar calculation can be done for SMEs, where the server (a microgrid) would reside at the company location itself. For SMEs, the additional cost would be a stack of software applications relevant for the business. It should be possible to provide a fully managed solution for about Rs 700 ($15) per user per month.

Taken together, this will create an opportunity for about 100 million computers in the next four years and help build the digital computing fabric in India. This will also give a fillip to various content and software providers. All of it can be done with the technology components that are available today.

From the mobile data perspective, what is needed is an open publishing environment which encourages thousands of microentrepreneurs much like what i-mode enabled in Japan. Operators should open up their walled gardens they will make for the money lost with far greater data traffic because in India the mobile has the potential to become an alternative device for Internet access.

The Internet and mobile will thus play a complementary role the small screens of the mobile offset by the full-sized input/output capabilities of the network computer, and the fixed nature of the computer offset by the portability of the mobile phone. India can be the role model for other emerging markets in creating a digital infrastructure which brings information access to hundreds of millions. This is what will change lives. Entrepreneurs will thus have the opportunity to do good and do well.

Next Week: India Internet and Mobile (continued)


TECH TALK India Internet and Mobile+T

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