The evolving telecommunication revolution is essentially an urban phenomenon. For example in India, with between 11 and 20 million subscribers being added every month, there is a wide disparity in the telecom penetration levels. While the urban centers and metros are over 50% penetration levels, rural penetration levels are less than 19%, with several thousand villages yet to see connectivity. The rural areas with low paying capacity and low concentration of subscribers are being bypassed. This is happening not only in India, but all over the world.
The need of the hour is to think of a new model of business that allows these people – with low incomes – who have never made a phone call to be part of the telecom revolution.
VNL coined the term “microtelecom” which is defined as the optimization of telecom infrastructure for a very specific application: serving low-income, hard-to-reach communities in rural areas. Like microfinance, microtelecom is based on the belief that “bottom of the pyramid” consumers can be profitably served, as long as the product or service is designed appropriately.
Microtelecom refers to business models designed from the ground up for low income rural users. It is characterised by four principles:
- Low Cost — Dramatic reductions in capital expense and running costs compared with the mainstream technology
- Low Power — Ideally completely independent of an unreliable power grid
- Ease of Deployment — Removing the dependence on a skilled or literate workforce
- Modeled for Purpose — Using business models that take into account local resources and limitations
By following these principles, microtelecom drives down the threshold of viability for mobile operators looking to profitably serve low-ARPU users.
VNL’s WorldGSM® is the industry’s first microtelecom solution; a complete re-engineering of GSM for the billions of low-income, rural users.
“The cost of passive infrastructure is enormous and telecom companies should consider the infrastructural challenges in the rural areas.”
- Sanjeev Aga, Chairman
CII National Committee on Telecom and Broadband