Thursday, November 12, 2015

The Buzz Around TV White Space

There's a war brewing around wireless broadband trials using TV white space in India

Shyam Ponappa  |  November 5, 2015

Large blocks of underused spectrum lie tantalizingly out of reach, waiting for enabling regulation, administration, and to some extent technology, to accelerate our move towards Digital India. One such category is unused/underused TV spectrum or "TV White Space" (TVWS). Despite growing demand, operators face bleak prospects as they struggle to deliver, starved of spectrum and infrastructure. Their dilemma is how to extend delivery capability without choking on buying spectrum so precious it's like an albatross around their necks, leaving little capital for densifying and extending their networks.

There's a war brewing around wireless broadband trials using TVWS in India, years after completion in other countries. These frequencies are most effective for long-range broadband. Mobile operators are watchful of developments such as Microsoft getting preferential access, triggered by announcements of its partnership with the Education and Research Network (ERNET) for countrywide rural broadband. Equipment suppliers also seem apprehensive of developments that could lead to swathes of spectrum being "unlicensed", reducing markets for their established products for licensed spectrum.

This article aims to clear some of the misinformation to facilitate policies for Digital India.

What is "TV White Space"?

There's confusion and disinformation about what TVWS is. Quite simply, TVWS is unused TV spectrum, or TV bands devoid of TV signals. The meaning derives from the areas on a page without print or pictures. Microsoft calls [the technology developed for] it "White-Fi", while some call [the technology developed for] it "super Wi-Fi".

Even bands broadcasting TV programs can have underutilised sections that can carry broadband, as pioneered by researchers at Rice University in Houston, Texas. Rice has a system that uses TV bands for both broadcasting as well as broadband.1 According to researchers, although the 400 to 700MHz band is used for broadcasting TV in many US cities, its capacity is largely underutilised because of alternative ways of accessing TV signals, such as through cable, satellite, or Internet TV. Therefore, incorporating Rice's technology in TV sets or remote equipment could significantly expand the urban reach of "super Wi-Fi", and not restrict it to rural areas.

Is there any TVWS in India? Some say there isn't!

Studies across the country show that over most of it, unused TV spectrum (white space) amounts to 85 to 95 per cent of TV spectrum.2,3,4 Studies excluding northern India show that in over a third of the area, a large band -- 470 to 585 MHz -- is available for alternate use.2,4

An odd controversy has been created about whether this is "white space" or not, precisely because the spectrum is largely unused.5 The convoluted semantics are mystifying, because white space is by definition unused broadcast spectrum. The National Frequency Allocation Plan already designates this band for fixed or mobile wireless, in addition to TV. In other words, without changes in allocation, operators can share TV spectrum on a secondary basis, as in the USA, the UK, and Singapore.

Regarding spectrum usage charges, as with any infrastructure, it is much more beneficial in the public interest to provide affordable services first and to collect government fees and taxes later, than to front-load auction fees and have no services at all (imagine road systems if up-front charges had to be paid for the right to build them). Overall benefits from Digital India, which is impossible in the foreseeable future without low-cost wireless broadband connections to the NOFN and other backbone networks like ERNET, will far exceed cash collections from auctions.

Proponents of auctions suggest that TVWS be reallocated as cellular spectrum and auctioned. Their reasons: (a) The transfer of public property to private operators; (b) Transparency and fairness; and (c) Government collections. This reasoning is false and misleading, because: (a) No transfer is required, as all operators can get secondary access equitably through a consortium approach; (b) This ensures transparency and fairness; and (c) Government collections from productive use will far exceed any auction collections, as evidenced by licence fees: in 2005, estimated auction fees lost until March 2007 were Rs 20,000 crore, whereas actual collections were double, at Rs 40,000 crore; collections by March 2010 were Rs 80,000 crore, in addition to the public benefits of better services.

Should TVWS be used only for 3G & 4G?

Another negative argument is the insistence that TVWS should be auctioned for 3G and 4G. Whereas Digital India needs low-cost wireless broadband, especially for long-distance links in rural India, because of the high cost and difficulty of building and maintaining fibre or wired networks in difficult terrain, and/or in sparsely populated areas. Therefore, access to TVWS needs to be bundled with the National Optic Fibre Network/BharatNet, and other shared backbone networks like ERNET. Policies should permit different network design scenarios including transmission power and purpose. Point-to-point links are needed over long distances in place of fibre or microwave, and broad coverage is needed for contiguous areas like industrial developments, campuses, commercial complexes, or rural communities. At the user end, TVWS could interface through cellular (3G or 4G) or Wi-Fi transceivers.

TVWS does need tight radio filters (unlike Wi-Fi) to minimise interference, the underlying consideration that drives spectrum management. There's also need for varying power specifications depending on the network design and purpose as described above, and policies for unlicensed sharing using geolocation databases, as defined by the US FCC (Federal Communications Commission).

To be most beneficial, it is not important to extract the maximum carrying capacity from TVWS in every location, as in the misplaced number-of-subscribers-linked spectrum policy some years ago. Rather, the objective for Digital India is to use this technology in combination with others for the purposes people need, namely, for affordable broadband wherever they are, while mitigating radiation hazards. This is essential for India to get its basic communications infrastructure.

Shyam (no space) Ponappa at gmail dot com

1., Jade Boyd, September 5, 2014.
2. IIT-Hyderabad studied TVWS in southern India from 2009, shared findings with the government/other IITs from 2011, and published in 2014:, Kalpana Naidu et al.
3., Pradeep Kumar et al, June 2013, IIT-Delhi.
4. arXiv:1310.8540v1 [cs.IT], Gaurang Naik et al, 31 October 2013, IIT-Bombay.



I think this whole issue of TV White Space is being clouded with needless convoluted semantics . The author also does not do much to ' clear the air '.Some basic facts have to be placed on the table and understood clearly. 

1. TV White Space ( TVWS )is not an access technology. Hence the comparison with 3G/4G/cellular technologies is infructuous. 

2. TV White Space is and is being positioned as a " Middle Mile " or a " Mobile Backhaul " technology. This means that it is supposed to compete/susbtitute with fiber or microwave. Indirectly, it is in direct competition to the Optical Fiber which is required to be laid between the Block and the Gram Panchayat ( GP )as a part of the NOFN/Bharat Net Project ! 

3. Going by the Expert Committee Report on NOFN, BBNL shall lay fiber at only 80% of the locations as it is not feasible to do so in the balance 20% locations. They have advocated the mixed use of UBR Backhaul technology (which works in the unlicensed bands ) and satellite technology for the technically non-feasible areas ! 

4. So , if at all there is a use case in the revamped NOFN project ( now called Bharat Net ) for such 'special technologies ' like TVWS, it is only in these 20% GPs only ( unless of course Govt. decides to abandon the fiber project and decide to opt for alternate long-distance wireless backhaul technologies ). 

5. TVWS is being touted as a " technology for providing Rural broadband ". However before we join the bandwagon, it may be good to step back and find out what are we talking about . The moot question is that is this truly a broadband technology ? What are the bandwidths that TVWS is capable of providing ? . In the classical NOFN architecture, each GP was to be equipped with 100Mbps bandwidth which was meant to be used by different Telcos/Internet Service Providers/Cable TV providers etc to provide broadband enabled services to the 640,000 ( and not 500,000 ! ) villages . The early results of the trials with TVWS technologies have indicated a throughput of ~10Mbps against a spectrum requirement of 10Mhz ( under ideal conditions ). By simple extrapolation, this means that to provide 100Mbps, it would need a minimum of 100Mhz spectrum ! Surely, this cannot be a very efficient way of using the spectrum , when the entire " White Space " available is of that order only ( Refer IIT Mumbai study report ). Also, it is quite clear that in GPs which have higher bandwidth requirements due to presence of co-located schools, hospitals , government offices etc , TVWS technology may not be appropriate for such higher bandwidth requirements. 

6. Digital India ensures provision of guaranteed broadband transmission bandwidths everywhere with guaranteed SLAs and not on ' best effort ' basis. We have yet to come across a single commercial network being run on TVWS technology anywhere in the world offering highly reliable ( five 9s grade ) and assured quality of broadband service. 

7. It may be prudent to point out that ' field proven' High Capacity Wireless backhaul technologies do exist ( which provide scalable capacities of upto 1-2Gbps ) at distances of upto 10-13 kms , which are in licensed spectrum bands. These are extremely low cost, highly efficient, interference free, Point to Point links which can meet the requirements and complement the government's fibre roll-out in a more cost effective manner than ' special technologies ' viz. TVWS , treated in a special manner ! 

8. Besides, the issue of auction vs free/unlicensed spectrum remains as another moot point where the business case of TVWS hinges on keeping it unlicensed and thereby leading to frittering away of ' precious ' natural resource viz. spectrum , in contravention to the SC guidelines. Given the hype and buzz , it may suffice to state that TVWS has not yet passed the peak of inflated expectations ! I think it would be prudent for the government to let the dust settle down, before making the next move ahead.
November 05, 2015

The author responDS 

Comments 1-5: A “comparison that is infructuous”: The article asks: “Should TVWS be used only for 3G & 4G?” The implied question: “or for other technologies including TVWS-specific ones?” The article also states: “…the objective for Digital India is to use this technology [TVWS technology, as against the spectral medium] in combination with others…” Yes, the term “TVWS” is applied to both the medium – the spectrum – and TVWS technologies, for the (new) technologies developed for that medium, namely, 802.22 and 802.11af. 

The commentator must surely know this, as also the TRAI’s recommendations on the next comment: 
“…direct competition to the Optical Fiber”: 
This perhaps reflects genuine confusion and/or lack of awareness of the complementary role of wireless backhaul (including TVWS). The article clearly mentions supplementing the backbone where laying fibre is too expensive or infeasible. The TRAI’s recommendations on microwave for backhaul discuss this in detail (see: – “Recommendations on Allocation and Pricing of Microwave Access (MWA) and Microwave Backbone (MWB) RF carriers”, Telecom Regulatory Authority of India, August 29, 2014. 

The more fibre, the better. The question is to what extent it can be deployed cost-effectively. For the rest, other technologies and mediums are needed for the intermediate mile. 

“By simple extrapolation, this means that to provide 100Mbps, it would need a minimum of 100Mhz spectrum ! Surely, this cannot be a very efficient way of using the spectrum , when the entire " White Space " available is of that order only…” 

Comments like this appear to be misleading, especially when made by a commentator who seems to understand the technological implications: if there are more cost-effective ways, those are the ones to use. If not, use less perfect methods, including TVWS. The objective is connectivity at reasonable cost, not designing or deploying the most appropriate technology. Why should TVWS be used in any other way than to provide a 100Mbps link to a node to which it is infeasible for cost or other reasons to lay a fibre connection? What could be more desirable in the public interest? Surely not the optimization of some academic measure of TVWS usage. This is where the best is the enemy of the good. 

Comments 6-8

"6. …We have yet to come across a single commercial network being run on TVWS technology anywhere in the world offering highly reliable ( five 9s grade ) and assured quality of broadband service." 

In the author’s surmise, this may be because the pioneers of TVWS-use and technologies (devices), namely, the USA, the UK, Singapore, already have good fibre and cable networks over most of their geographies. It is only on the fringes that they lack adequate connectivity. These are insufficient markets to provide the level of demand that could have otherwise led to proliferation, and therefore lower-cost devices and success. For instance, device makers are relatively small companies. So it’s a chicken-or-egg situation. The markets that are large enough are China and India, and both have started considering TVWS. Huawei has even acquired one of the early manufacturers, Neul, which was involved in the UK trials. The latter may be an indicator of possibly higher volume production and deployment, assuming Huawei knows what it’s doing (and it certainly seems to). 

"7. It may be prudent to point out that ' field proven' High Capacity Wireless backhaul technologies do exist ( which provide scalable capacities of upto 1-2Gbps ) at distances of upto 10-13 kms , which are in licensed spectrum bands. These are extremely low cost, highly efficient, interference free, Point to Point links which can meet the requirements and complement the government's fibre roll-out in a more cost effective manner than ' special technologies ' viz. TVWS , treated in a special manner !"

This is partly true, but leaves out the rest of the relevant facts; else, if they were really low-cost (and unrestricted), such links would have been deployed extensively in India. Instead, the high cost (and restrictive regulations) make it impractical. This has resulted in the matter being taken to the Supreme Court [Supreme Court civil appeal No. D29714 of 2010]. All this is given in detail in the TRAI recommendations referred to above. 

"8. Besides, the issue of auction vs free/unlicensed spectrum remains as another moot point where the business case of TVWS hinges on keeping it unlicensed and thereby leading to frittering away of ' precious ' natural resource viz. spectrum , in contravention to the SC guidelines."

Consider this: the objective is digital connectivity, in the sense of ubiquitous affordable access. It has not been achieved, and appears infeasible without lower cost access across rural India. If there are better, less expensive ways of providing it, suggest them by all means. If you can’t, think about (a) the objective (ubiquitous affordable access) and (b) constructive alternatives, and try to suggest practical solutions, and avoid misleading or ill-informed comments.  As for the Supreme Court guidelines, if the government formulates sound policies in the public interest, the court's aims will be well served.

9. "Given the hype and buzz , it may suffice to state that TVWS has not yet passed the peak of inflated expectations ! I think it would be prudent for the government to let the dust settle down, before making the next move ahead." 

TVWS use with TVWS devices is not proven. That’s what the trials (mentioned in the article) are about. 

November 10, 2015  

Friday, October 2, 2015

Digital India - Now to Work

Despite the PM's interest, much remains to be done.

 |  October 2, 2015

There's a buzz about Digital India again with an Indian PM finally reaching Silicon Valley. So are we close to broadband taking off, or is this just more hype?

The announcements are certainly promising. For instance, that Indian Railways will provide Wi-Fi services at 500 railway stations over the next few years. Google's support tendered by CEO Sundar Pichai offers new hope that this will happen. Other promising announcements include Microsoft CEO Satya Nadella's announcement of cloud-based services from India, and connectivity at the village level through TV White Space (unused broadcast spectrum), and Qualcomm CEO Paul Jacob's $150-million fund for start-ups in India.

There have been announcements like these before. For instance, the Railways announced Wi-Fi projects for years, with modest achievements. For details, see "A history of Wi-Fi and Indian Railways from 2006 to Infinity (maybe)".1

What's troubling is that in terms of ground realities, except for TV White Space for broadband, there's little evidence of a systematic approach to problems besetting communications, and changes in policies to solve them. Everyone seems carried away, and this is as true of most of the media and the commentariat as it is of the politicians. But informed, systematic efforts at solutions are absolutely essential to achieve these aspirations.

Take the ingenuous comparisons of Silicon Valley with Bengaluru, with the latter being described as "nearly there". Such election rhetoric from former US Senator and Secretary of State John Kerry is one thing, but our savvy media folk should know better. People who visit Silicon Valley from India, or those who are based there and occasionally visit India, can't be blind to the stark differences. One is a place where the basics related to living and functioning effectively actually work well; the other isn't. One has potholed streets with garbage, decrepit or nonexistent sanitation, and chronic power cuts; the other doesn't. It's as simple as that.

This leads to another observation that's tossed off too easily, about less need for government. Blithe statements that government needs to be reduced, or to get out of the way and let the private sector function, are often made with apparently little understanding of what governments do before getting out of the way. Those essential services in Silicon Valley and elsewhere that function seamlessly and are taken for granted? That's what governments can do. In other words, that is government's responsibility: to provide, apart from security and law and order, the infrastructure services and organisation of communities, markets and financial systems that enable citizens to function effectively and live well. Yes, markets are indeed planned and structured in order to function well.

The data on broadband at the end of 2014 in the Broadband Report 2015 by the ITU and Unesco suggest that India is not doing too well compared with its developing neighbours in Asia (see chart below).2  Our leadership and government need to confront this reality, and apply themselves to reforms to improve conditions. Broadband subscriptions as a percentage of our population trail most countries, and the percentage of individuals using the Internet is at the bottom of the pack, with Myanmar, Bangladesh, Pakistan and Nepal.

To make Digital India a reality, here's what the government needs to do:

  • Trials using TV White Space (TVWS, or unused broadcast spectrum) for broadband are finally under way, after years of struggle to get them going. If they work out, policies must be framed quickly for this spectrum to be bundled with fibre backbones such as BharatNet (the erstwhile National Optic Fibre network), and licensed service providers given access at reasonable cost.
  • Policies need to be formulated with government and operators working together, instead of as adversaries. This will increase the probability of success, as the private sector can be convinced of and contribute to practicable methods that they accept.
  • Policies for sharing spectrum can be extended to other under-used spectrum held by the government and Defence (secondary sharing, as in the USA), and to networks as well. This will facilitate broad, contiguous spectrum bands that are essential to support rising data usage that is affordable. Policies must also enable authorised operators to access all networks, fostering competition while increasing revenue potential and reducing costs. The data on broadband at the end of 2014 in the Broadband Report 2015 by the ITU and Unesco suggest that India is not doing too well compared with its developing neighbours in Asia. Our leadership and government need to confront this reality, and apply themselves to reforms to improve conditions.
  • The TVWS devices are manufactured by relatively small companies abroad with the exception of Huawei, which acquired Neul, one of the pioneers in the UK. Indian innovators can produce such devices locally, but only if they have a supportive ecosystem. That means sufficient continuing orders to create revenues for sustainable profits and cash flows. In a market like India, such orders need government support until new policies are in place and the demand is established. Once that happens, private enterprises can compete.

    For instance, a chip designer start-up in Bangalore with designs for TV and broadband cards using TV White Space has had to scramble to manufacture complete products to bring their prototypes to market. Without sustained buying, they'll languish like other device manufacturers overseas, with episodic sales to narrow markets. That's because developing economies are likely to be bigger markets for these devices than developed economies, but only after policies allow deployment; secondly, there's insufficient support in developed markets. The irony will be if Indian innovators can get only offshore prospects like Huawei as partners or investors.
  • Unremitting government effort in the systematic development of basic infrastructure services (at the primary level, besides communications, there's power, transportation, water and sanitation, basic health and education; at the secondary level: communities, markets and financial systems) will round out the potential for India as a producer economy as well as a large and growing market.

This is the work that now needs to get done: accept the reality of our infrastructure deficiencies, change our spectrum and network sharing policies, plan step-by-step, and execute for results.

Shyam (no space) Ponappa at gmail dot com

Friday, September 4, 2015

More On Those Dropped Calls

A basic problem is that the cost of spectrum and licences relative to earnings is too high, structurally.

Shyam Ponappa   |  September 3, 2015

Will the government's variant of "speak softly and carry a big stick" deliver Digital India in a hurry? Unlikely, because the problem is an overloaded system with a too-spare design, and insufficient cash flows. Increasing call drops are a symptom of inadequate carrying capacity for the demands of traffic, from voice to data in 3Gand 4G. These are structural problems, because the system doesn't generate sufficient investible funds; nor are conditions right to develop such investment capacity; nor are the prospects demonstrably healthy. The situation requires the policy changes outlined below, which only the government can bring about, as it has in the past.

A fundamental aspect of the problem is low spectrum availability. India's operators have 12-15 MHz, compared with a global average of 45-50 MHz. Leading countries have even more; for instance, operators in Seoul reportedly have 10 times more spectrum than operators in India. Limiting the spectrum available to operators compels them to invest more to deliver a given level of traffic and quality than if more spectrum were available.

There are other aspects as well:
  • high charges for licences and for spectrum, 8+4 per cent of (adjusted) revenues in addition to auction payments,
  • imported equipment paid for with a weak stream of local-currency revenues,
  • changes in spectrum holdings that require adjustment in equipment after older spectrum assignments lapse and new spectrum has been acquired, and
  • the burgeoning need for new investments for 3G and 4Gservices. Embedded in the latter is the additional overload caused by tower shut-downs and the difficulties in getting additional sites, apart from the need for more capital.
Add regulations that hinder spectrum trading and sharing, and we have a sector that is structurally weak and restricted in scope.

As for call drops, operators in developed markets experienced similar capacity pressures when there was very rapid growth in data usage, for instance AT&T in the USand O2 in the UK some years ago. The difference is that they were able to invest rapidly to shore up their networks. By contrast, Indian operators had to invest disproportionately in acquiring spectrum, leaving less capacity for investment in networks. For example, in 2014 operators in China reportedly invested $35 billion in 4G equipment, whereas in India, only $3 billion went into equipment. Most of its $32-billion investment - $29 billion, over 90 per cent - was for spectrum. There has also been the diversionary effect because difficult business conditions in the sector led to profits being invested elsewhere, instead of back into communications infrastructure. The difference in approach and functional capacity is stark: China is moving ahead with building high-speed data capability, while the struggle in India is with dropped calls and simply keeping users connected. The government, therefore, needs to facilitate conditions whereby operators invest substantial amounts every year.

For this to happen, the structure of high charges for spectrum and licences relative to earnings has to change, as do restrictive regulations. The monthly average revenue per user in India at the end of 2014 was of the order of Rs 110-120. Capital expenditure ranged from 13 to 15 per cent of revenues in 2014, rising to 20 per cent in 2015. The latter exceeds the percentage invested in the US - but the revenue in India is about 25 times less than the $50 revenue in America, and the US has had well-developed networks for decades. Meanwhile, the recent spectrum-sharing guidelines that restrict more than enable effective sharing epitomise our dysfunctional regulations.
 It is baffling why the government would issue such retrograde regulation if the goal is digital development, because these guidelines do exactly the opposite of what is needed.

Government versus Private Sector

Meanwhile, there has been an escalating war of words between the government and service providers. The latter are trapped in a vicious circle of heavy investment requirement with low revenue-generation capacity, as explained above. Breaking out of this trap is possible only if the government develops conducive policies, as it did with the path-breaking changes associated with the 1999 New Telecom Policy (NTP-99). The change at that time was from up-front licence fees to revenue-sharing. It fell short because the government's share was too high, and began to work only after 2003, when government charges were reduced. In like manner, the government needs to frame policies applying similar principles to spectrum, and ultimately to network infrastructure, so spectrum and networks become more productive.

Our problems arise from three sources: regulations and government charges, operator behaviour and responses, and public opinion and the perceptions and actions of the judiciary. The government can take the initiative through creating policies that facilitate investment and service delivery. Many changes are purely administrative, such as permitting unrestricted spectrum sharing without additional "conversion" charges, or reducing licence and spectrum charges. Surely the department of telecommunications, the finance ministry, and the prime minister's office understand the logic of higher net present values that accrue from incremental revenues to operators. Conversely, any restriction of revenues or opportunity loss reduces the government's share, resulting in lower net present values. For example, restricting 3G roaming or insisting on payments to convert administered spectrum before it can be shared limit revenues, resulting in opportunity losses.

The government needs to be persuasive while acting decisively, to influence operators and public opinion through well-formulated systematic initiatives. Tighter monitoring of quality, including dropped calls, and related penalties are needed - but balanced with constructive policies. These could cover enabling regulations such as for roaming and secondary spectrum sharing with the government, and in developing a consortium approach for active network sharing initiated by the government with broad private participation, led by a private-sector partner. Other potential areas include enabling, organising, and facilitating broadband through cable networks, and inducting technologies such as TV White Space and satellites.

This is where the rhetoric of leading Team India has to be walked and not just talked, to persuade and lead the sector to collaborate and not undercut institutional development.

Shyam no-space Ponappa at gmail dot com

1 E.g., see



The huge bids while acquiring spectrum at the auctions held recently were bound to impact operator's short run cash flow and investment capability. This in turn impacts network management and up-gradation at least in the short run. No amount of dictats will change this


Would it be over dramartic to say that call drops are the gasps of an industry that is drowning in something other than windfall profits ! Indian businessmen are not saints, true, but they need a more sympathetic hearing in the government's court. If the Savile Row types are in distress, what will happen to the rest of us ?


Nice article, and good points about institutionalizing, not just doing jugaad. However, the point about equipment is not valid, falling capacity costs are the main reason telecoms are able to deliver such good service in India. (not customer support). Call drops are far lower in India than many far richer countries in the world. Some leading operators in UK & US both have much higher incidences of call drops. Instead of absolutism, the government should link the maximum charges leviable by the operator to Quality of Service, and let the operators decide how they are going to distribute their services.

Thursday, August 6, 2015

Those Dropped Calls!

                                         And what could be done to fix them...

Shyam Ponappa  |  August 6, 2015

Why do we have so many dropped calls on our mobile phones? Operators say it's because of the closure and shortage of cell towers, and too little spectrum. Public opinion is conflicted, wanting better services at low prices, fearful of the hazard of more towers, while also wanting operators to pay dearly for spectrum through auctions. The government asserts there's enough spectrum and operators need only to invest and deliver. Can these be resolved to get better services?

There are several elements in this situation relating to technology, to the regulatory aspects of administration (policies and regulations), or to management aspects (structure, organisation and processes). Understanding these and managing them will be crucial in devising solutions.

First, an overview from a lay perspective. An operator runs a number of "cell towers" connected together, as well as to other operators' towers (mobile networks) and fixed networks. A cell tower in its simple form - for one operator, covering one cell/area - comprises a base transceiver station (radio), antenna (mast), and other equipment. Radios need spectrum for wireless communication between towers, and subscribers linked to towers.

Apart from spectrum and licensing costs, the number of towers in an area drives the capital and operating costs, materials and energy used, and the environmental impact. As each tower covers a number of subscribers and spectrum is used for wireless connections, more subscribers need more spectrum. So, a given set of towers provides greater traffic-carrying capacity if there is more spectrum. Conversely, less spectrum requires more towers and equipment, which means higher costs and environmental impact. In other words, for a given frequency range (spectrum band) and set of towers and subscribers, a small set of broader bands can carry more traffic than can a large set of narrower bands.1

Calls get dropped or blocked if there is too little spectrum for the number of subscribers, because the calls exceed the spectrum's carrying capacity. Users get good reception if they are near towers, but if other towers are too close, interference from signals from those towers can reduce the capacity of available spectrum, and reception may also be noisy. A weak connection with a distant tower results in poor reception. Distance cuts both ways: a short distance from tower-to-user yields a good connection (strong signal), but other towers must be far enough to avoid interference (i.e., have weak signals for the user). For 900 MHz with a mast height of 10 metres, this tradeoff results in distances between towers of under 100 metres in Delhi because of the scarcity of spectrum, compared with 200 metres in Istanbul, 300 metres in Munich, or 350 metres in Berlin.2

An additional benefit of more spectrum is that peak-hour capacity increases, so that more traffic can be carried without calls being dropped or blocked over the same network configuration. Our problem is that we have many operators with narrow, non-contiguous slivers of spectrum. This further reduces the efficiency of the available spectrum.

A reduction of towers because of closure on account of public pressure or for environmental reasons creates genuine problems, but simply adding towers is only a partial solution, as it doesn't remedy the shortage of spectrum. One reason is interference resulting in the reduced capacity of available spectrum - because cells in our urban centres are less than 100 metres apart, much less than in other countries, because sufficient commercial spectrum hasn't been made available. Therefore, more towers alone will cause spectrum to be used less efficiently, but won't reduce dropped calls arising from insufficient, fragmented spectrum. Also, adding towers is expensive, and is detrimental to the environment.

Operators deal with scarce spectrum by deploying more base stations per unit area, and also by using advanced technologies such as adaptive multi-rate codecs and synthesised frequency-hopping. In 2008, Indian operators were among the few worldwide to adopt such techniques, while having the smallest outdoor sites and heaviest traffic densities per MHz.3 This results in higher costs relative to revenues.

Contrast with China

Comparing the approaches taken by China and India, there's little doubt of the need for a change in our approach. China provided operators with low-priced spectrum to scale up and drive economic growth, among other forms of support. Despite foreign holdings, it hasn't imposed substantial fees. India brought in more operators than other markets, didn't provide as much commercial spectrum, fragmented what it had, and priced it out of sight. Consequently, substantial spectrum is idle with the government, while large operators with very little spectrum and the legacy of underdeveloped fixed networks have over 100 million customers each, with high voice and growing data usage. This situation is likely to worsen as more spectrum holdings come up for renewal.

Efficient data transmission requires even broader bands. The charts below show how capacity increases per MHz with broader bands, and the bandwidth in terms of megabits per second (Mbps) needed for services.

Capacity Increases with Broader Bands

Source: Search on Google for: "Optimising mobile broadband performance by spectrum refarming"; white paper by Nokia Networks.

Possible solutions

One possibility is to adopt policies and regulations that facilitate spectral efficiency, e.g., allowing roaming and spectrum trading. This wouldn't mitigate the problem of excessive capital expenditure on spectrum auctions that exceeds investment in networks (according to an industry estimate), but would probably improve spectrum utilisation.

Another is to share all spectrum through pooling, allowing common-carrier access on payment to Radio Access Networks including spectrum. If charged only a reasonable revenue share with incentives such as reductions for rural services, there is likely to be explosive growth in broadband delivery with an increase in government revenue, if the organisation and coordination is done right. The government needs to bring together operators and other stakeholders, including the Ministries of Communications & Information Technology and of Information & Broadcasting, and with expert help, work out how to organise and deliver the promise of Digital India.

Shyam nospace Ponappa at gmail dot com

1. An assessment of spectrum management policy in India, 2008; p 10:

2. For GSM, there is a 50 per cent increase in the capacity per MHz using two channels of 12 MHz each instead of two channels of 6 MHz each. Ibid., 15.

3. Ibid.,28.

Friday, July 3, 2015

The Centrality of Cash Flows

Dealing with the inexorable force of cash flows.

Shyam Ponappa  |  July 2, 2015

Greece's experience tells us that cash flows are crucial to economic outcomes. No matter how far-reaching the vision, ambition, and slogans, the effects of cash flows are profound and inevitable. Many of our politicians and bureaucrats and a large proportion of the public seem oblivious to how cash flows affect our political economy. This apparent absence of understanding (or flouting of fundamentals by opportunists who understand them but act in their own interests) shows up in many ways among all political parties in their approach to the basics: the provision and pricing of essential services such as security and law-and-order, electricity, broadband communications, transport, water, sanitation, and waste disposal. Without an understanding and acceptance of how essential cash flows are for providing these services, we can't realistically aspire to better living conditions. No matter how well or wealthy you may be, you still have to pick your way gingerly through the mess and the stench of your environs when you step out.

Cash flows are at the crux of the problems our governments face at the Centre and states, and that society is up against. They include all the legacy issues mentioned above of the inadequate infrastructure services that we endure, and extend even to problems such as the defence services pensions. While the National Democratic Alliance is not blameless, there are egregious instances among other political parties, such as the Aam Aadmi Party's (AAP's) actions on waste management and electricity supply in Delhi. The essential sticking points have been delayed (obstructed) cash flows, whether in paying sanitation workers or electricity distributors. These instances are mentioned only as indicative examples, as their processes hark back to the habitual practice of governments at the Centre and the states of delaying payments, whether it is fertiliser subsidies to manufacturers (a central government "habit" for decades), or setting realistic tariffs and making prompt payments to electricity distribution companies, as in the case of state governments running Delhi. Various parties - the Congress until 2014 and the AAP thereafter - have themselves been victims of the structural constraints of electricity generation plants with antiquated, inefficient equipment, as in the old coal-based plant at Badarpur, or efficient, modern plants using gas caught in an upward price spiral with domestic gas not being available, such as at Bawana.

In the communications sector,constrained cash flows limit services. One rough estimate is that cumulative charges for spectrum amount to about Rs 1.8 lakh-crore ($30 billion), roughly equal to the total amount invested in networks and equipment. In other words, operators could have invested double the amount in networks and equipment if it had not been paid in government charges. Operators had to take on significant debt for prior payments, thereby hampering their ability to invest in extending and upgrading their networks.The operators' financial constraints constitute one major reason that a market hungry for data services is starved. (Another major reason is the technology constraint of narrow, noncontiguous bands of spectrum, but that is another tale.)

The situation in electricity supply is much worse, because of the high and still growing level of stressed assets of the state electricity boards. Press reports estimate that as much as Rs 53,000 crore may possibly become non-performing assets (NPAs) by the end of September.

There is a view that stressed assets and NPAs need not be a problem, because they can be readily sold to new owners who could reorganise the undertakings, which could succeed or go out of business if they fail. While this is theoretically possible, in practice, this is quite difficult and impractical to carry out, especially in hard times. Banks typically are not equipped to take over a number of non-performing businesses and run them until they can dispose of them. Secondly, considering the problems of being profitable in bad times combined with generating cash for operations in downbeat markets, it is unlikely that there will be acceptable buyers willing to pay reasonable prices for loss-making assets.

One difficulty in addressing such issues is that the basic concepts - of cash flows, of numbers from operations in the profit-and-loss statement in tightly coupled lockstep with the balance sheet, which leads to the cash flow statement, require a level of effort to understand that many are unwilling to put in. Cash flows are measurements of flow, whereas profit-and-loss and balance-sheet items are accumulated over specified periods such as a month or quarter, i.e., statements of stock,with no easily discernable relationship to actual cash movements in those periods. There are additional complexities in delving deeper, e.g., in considering the similarities with the flow of liquids. As cash flows are in some ways comparable to liquid flows, there is research from the perspectives of fluid dynamics that requires an understanding of more complex mathematics, physics, or engineering. For those interested in exploring these aspects, further readings are suggested below.1

Put intuitively, the key is in setting up and/or taking corrective action to facilitate smooth flows, with the recognition that disruptions create turbulence. Smooth flows are laminar, as the layers or lamina of fluid move easily without mixing (see diagram). Once turbulence sets in, it takes time and often additional effort (resources) to revert to smooth flows, because the obstacles have to be removed or worked around, and the vortices and eddies created by disruptions have to be stabilised and smoothed out.

Flow - Laminar (Smooth) & Turbulent

The point is that if key decision makers have an appreciation of cash flows and simulation techniques, they can be better informed in making decisions to improve flows. This understanding needs to be visceral and at the top levels, and not just among financial and engineering experts. This is why it would be useful for the PM and his team to seek financial, organisational, management and technical inputs.

                                                                                                       Shyam no-space Ponappa at gmail dot com

1. Measuring Financial Cash Flow and Term Structure Dynamics, Cornelis A Los, 30 November, 2001:

Financial Market Risk: Measurement and Analysis, Cornelis A Los, Routledge, 2003; 2006.