Everyone loves unlimited data except, of course, the telecom operators themselves. The ability to watch Youtube videos in Full HD or watch the latest season of Narcos on Netflix at 4K without having to worry about running into overages is a very compelling proposition. However, ever since the data revolution began in India, none of the incumbent telecom operators have ever provided us with truly unlimited data.
There have been instances where some of the smaller operators have indulged into providing unlimited data but with certain caveats. BSNL, for example, started providing unlimited data on its EVDO network but getting a CDMA SIM from BSNL was a hassle in itself and it had long back stopped investing and expanding its CDMA network. Reliance was willing to offer unlimited 3G to its customers buying an iPhone 5S but tethering was not allowed and you had to stick with Rcom for two years. Very recently, BSNL also introduced an unlimited 3G pack on its GSM network but again the quality of their network while great at some places doesn’t really match that of the incumbents.
It is possible to find unlimited 3G data packs but it’s mostly by operators that don’t have a great network. Amongst the operators that have rolled out 4G, none of them seem willing to provide truly unlimited 4G anytime soon. Airtel, Vodafone and Idea that do indeed have the financial muscle to roll out 4G networks in India, have never offered unlimited 3G in the past. The packs that they claimed offered unlimited 3G had horrible post FUP speeds when a certain threshold was crossed. Even Jio, which many anticipated would bring unlimited 4G, has refrained from introducing the same.
Why operators are refraining from introducing truly unlimited 4G in India is an interesting question to analyze. There are certain reasons for the lack of truly unlimited wireless data in India.
1. High population density
India has one of the highest population densities in the world. Population density plays a crucial role in determining the way telecom operators evolve. There are only a limited number of spectrum bands that telecom operators can use to provide the services. Generally, the type of spectrum band that telecom operators can use is internationally agreed upon at ITU. The reason for this is that telecom vendors and smartphone/feature phone manufacturers can create equipment that can be used internationally and to facilitate roaming.
So let’s say an operator in both Europe and India are providing 2G services on 900 MHz band. Assuming they are using the same telecom equipment, both operators will theoretically be able to cover the same amount of geographical area per BTS (Base Transmission Station). Considering that the coverage of BTS is the same, the thing that really ends up determining the number of users that are serviceable by that particular BTS is the population density.
If the European operator has a population density of 100 people/km2 and if the Indian operator has a population density of 400 people/km2, then the latter can serve 4 times more people than the former.
To be clear, population density has helped us a lot during the voice era. One of the prime reasons why calling tariffs in India were so low was because of our population density. The sheer number of people that every single BTS could address made it possible to distribute costs as widely as possible and help us have really cheap voice tariffs. But the same population density is coming to bite us back in the data era.
When it came to voice, operators were able to boast that their BTS was carrying X number of minutes. It was possible for operators to determine how many subscribers they would be able to service for voice calling as voice was a fixed application. However, the same is not true for data, as data is variable and depends on how you make use of it.
For example, imagine that 50 people in an area are simultaneously making voice calls or are already on a voice call from a particular BTS, it’s possible for the operator to determine how much spectrum would be needed to service those 50 people. On the other hand, imagine 50 people accessing data simultaneously from a particular BTS. If even 10 of those 50 people are continuously streaming 4K video then the network quality automatically drops for the remaining 40 who might be trying to just browse a website or make a VOIP call.
The problem of congestion at cell sites due to a particular few data heavy users becomes even more severe in countries with high population density. Already the cell site is servicing more users in high population density areas and owing to this, the probability of people who would use a lot of data for activities such as 4K streaming also increases. This is the reason why most telecom operators in India have shied away from providing truly unlimited data. If they did, a select few heavy users could bring down the network quality for everyone. This has also been witnessed to some extent with the launch of Jio and its free offer, during peak times the network becomes almost unusable.
2. Spectrum crunch
Indian telecom operators have operated at some of the least possible spectrums. When it came to 3G, most operators were provided just 5 MHz of 2100 MHz spectrum. Compare this to some countries where operators had as much as 20 or 30 MHz of 2100 MHz spectrum to provide 3G and it starts to become clear as to why operators were reluctant to provide unlimited 3G.
If truly unlimited 3G was provided by any of the top three telecom operators, then taking into consideration the population density of India and the measly 5 MHz of spectrum, it would have been surely possible that network quality would have significantly deteriorated in certain pockets of cities. Although spectrum crunch was a big issue faced by the country, I must admit that the government has done a fine job in making extra spectrum available.
When it comes to 4G, most operators have at least 10-15 MHz of FDD spectrum and 20-30 MHz of TDD spectrum, definitely much better than the spectrum position in case of 3G. But even with the increased spectrum holding in the case of 4G, unlimited still doesn’t seem to be a possibility. Jio is currently offering an unlimited like (capped at 4GB/day) offer and there end up being moments where the network becomes completely unusable.
3. Very poor broadband penetration
This is probably the biggest reason why unlimited internet isn’t a reality in India. Very few people in the country have wired broadband connections at their homes. Most just rely on mobile data. Wireless broadband connections will always be constrained by spectrum and the same restriction doesn’t apply to wired broadband networks. The latter have the potential to carry a lot more data than wireless networks. But very few people have subscribed to wired broadband connections in India. There are less than 20 million wired broadband connections in the country. Assuming every household has 4 people on average, less than 80 million people have access to wired broadband in India which is a country of more than a billion people. Even amongst the players that provide wired broadband connections, 80% of the market is cornered by BSNL and Airtel. Both BSNL and Airtel have pathetic post FUP speeds of 1 Mbps and 512 kbps. Even the pre-FUP speeds are easily lower than what a 4G network can achieve if there’s moderate congestion.
If any operator unveils truly unlimited 4G, then people will by default resort to using it as a home broadband connection which would entail heavy duty stuff like streaming FHD/4K content or downloading torrents that would end up making the network unusable for everyone else and bring down the overall quality. Before Jio’s Welcome Preview Offer kicked off and when it was still available to a select few employees, Jio had said that people on average were downloading 23GB of data per month. Operators like T-Mobile and Sprint that provide unlimited data in the US, have their average data consumption at 2-3GB/month.
4. Business case
Apart from high population density, spectrum crunch and even poor broadband penetration, Indian telecom operators have a vested interest in not providing unlimited broadband plans. Data usage is on the growth as of now, it makes sense for operators to tap into this growing data usage and charge people for every additional GB of data they use.
If they start providing truly unlimited data, then they miss the opportunity of being able to charge the higher consumption users even more and fail to monetize from the ongoing data growth. Operators are known to have made things unlimited only when growth ends and voice is the perfect example of this. Globally, most operators charge nothing for voice and even in India Jio has provided voice for free along with data packs; a key reason as to why Jio has done that is because growth in India’s voice market is all but over. It simply no longer makes sense to charge for voice as there is no growth to arrest.
Will unlimited ever be possible in India?
The first thing that’s necessary for unlimited data to be a possibility in India is for wired broadband networks to develop. Current wired broadband speeds and post FUP speeds are simply unacceptable. There really needs to be a quantum leap in the speed of broadband networks and the amount of data allotted so much so that the in-house Wifi network becomes the first choice and the 4G network becomes the second. Airtel’s V-Fiber plans and Jio’s upcoming broadband plans provide some hope, but by when they’ll start being meaningfully deployed remains to be seen.
Apart from the improvement of current wired broadband networks, we need a lot of public Wifi hotspots in a lot of places to reduce the load on telecom networks. But as can be seen by Arvind Kejriwal’s hollow promise to provide free Wifi in Delhi, this seems to be a long way to go. However, public-private partnership (PPP) can help in this regard as seen with Google’s plan to provide free Wifi in Railway stations in conjunction with RailTel.
The government needs to put up even more high band and low band spectrum on sale at reasonable prices so that the telecom operators can beef up their spectrum holdings and prepare themselves for the Tsunami of data that’s going to come in the years to come.
Improvement of wired broadband networks, high-quality public Wifi networks and availability of more spectrum are a given but telecom operators still have a vested business interest to not providing truly unlimited data. If wired broadband networks are improved, more high-quality public Wifi networks are introduced and telecom operators have a lot of spectrum, then because of competition, the underdog would feel compelled to introduce unlimited data to differentiate itself from the incumbents. That’s what happened in the US with T-Mobile and Sprint providing unlimited data, but Verizon and AT&T not providing the same. All in all, unlimited broadband plans are still quite a few years away in India.