Amid pandemic, fixed broadband grows in smaller cities

Amid pandemic, fixed broadband grows in smaller cities

New Delhi/Mumbai: Rahul Kumar, a Noida-based software engineer working at a multinational, recently moved to his hometown in Bihar’s Muzaffarpur, after his employer extended the work-from-home (WFH) option till the end of the year. Kumar got an optic fibre connection from a local service provider to ensure fast and uninterrupted access to the internet. “I knew that mobile broadband won’t be able to handle my daily work requirements. So, I got a fixed broadband connection,” he said. Like Kumar, professionals who moved to their home towns opted for wired internet because of the data-intensive nature of their work, driving up demand for fixed broadband lines in smaller cities, which have typically been more dependent on mobile broadband.

Remote working and learning requirements exposed users in smaller cities to the benefits of a wired broadband connection. In many cases, companies in the information technology and financial services sectors incentivized staff to get such connections.

“Transition from 4G mobile broadband to wired line has increased drastically in large and small cities after covid-19. The fact that many people have moved to tier 2-3 cities has contributed to this. Also, with covid-19, people in these cities who have to work from home or attend online classes started realising the importance of wired lines,” said Vivek Raina, chief executive and co-founder, Excitel Broadband India.

Before covid-19, service providers had to make a case for wired broadband, by focusing on binge watching content, work-from-home and tasks that need a lot of data, Raina said. “We saw 30-35% increase in demand for wired broadband services as compared to pre-covid times,” he said.

Excitel, which offers services in five circles, saw a sharp growth in wired broadband business in cities such as Kanpur and Guntur.

Bharti Airtel, too, witnessed high traction and, to capitalize on that demand, it accelerated broadband installation. “We believe there is massive opportunity in smaller towns across India in the home broadband market. We are, therefore, doubling down on our partnership with local cable operators in such towns. We are live in 14 such cities through this partnership model,” Gopal Vittal, managing director and chief executive, Bharti Airtel, said during the company’s Q1 FY21 earnings call on 30 July.

According to latest data from Telecom Regulatory Authority of India (Trai) fixed wireless (Wifi) and wired broadband subscribers comprise barely 3% of the total broadband subscription market in India, largely due to the lack of fibre rollouts in India. According to telecom analysts, although region specific broadband data is not available, Reliance Jio had reported 82000 additional wireline connections between March-April. Jio offers wireline connections by default with the fibre to the home connection.

“ Our sense is that in April-May people did not have the ability to get new connections due to the lockdown but within this year we do expect wireline broadband connections to grow given extended WFH requirements however it will require the large operators to invest aggressively in these markets,” said Sachin Gupta, Senior director, CRISIL Ratings.

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