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Connect. Create. Innovate. India Mobile Congress 2018 New Digital Horizons Connect. Create. Innovate. India Mobile Congress 2018 October 2018 KPMG.com/in New digital horizons: connect, create, innovate 1 Current state 2 Where we want to be Trillion dollar digital economy 1.1+ billion subscribers dream: Convergence of connectivity and advanced technologies like AI, Teledensity at M2M, IoT, analytics is bringing India closer to its trillion dollar 89.72 per cent digital economy dream. Telecom companies (telcos) having a direct interface with end users, can 512 million internet play a central role in the digital subscribers revolution by moving beyond connectivity. It can be the platform to allow the interplay of these Government initiatives advanced technologies to create digital solutions across varied driving digital growth industries. In the next few years, a significant portion of revenue will be growing from FDI ~ USD5.9 billion digital initiatives enabled by during Apr-Dec 2017 5G network. 3 Challenges Falling Huge capex Debt repayment of USD119.44 billion revenues requirement as against its annual revenue of around (ARPUs) (USD17 USD38 billion billion FY19-20) © 2018 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 4 How to get there Connect Investments in 1 rural India 2 content ecosystem Enhance start-up Create networks ecosystem to 3 4 of the future foster innovation Expanding business Build a customer models beyond 5 centric ecosystem 6 connectivity Significant intervention from all stakeholders (public and private) required to uplift the industry and realise the 5 Need of the hour potential that new digital horizons hold Rationalise Robust cyber, data Increase overall spectrum allocation security framework fiberisation Bridge skill gap and pricing and data privacy norms Simplification and Favourable device, Redefine Adjusted Rationalisation of uniformity of RoW component Gross Revenue taxes and levies’ policies manufacturing (AGR) Public Private Lower cost Partnership(PPP) of backhaul models for shared connectivity infrastructure © 2018 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved © 2018 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. © 2018 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved Foreword Indian Telecom Industry has including over 8600 villages and I am happy to be part of the IMC witnessed one of the fastest paces installation of over 300 mobile meet this year, with a theme of of expansion in the recent years. tower sites. We are into the 4th connect, create and innovate that The government and the industry year of Digital India initiative, in this resonates well with the direction have worked together to make period we have tripled our telecom that the industry is headed Indian Telecom Network, the 2nd infrastructure, we are spending towards. I trust a meet like this largest in the world with a total 9 billion in providing optic fiber in will provide an opportunity for all subscriber base of over 1.1 billion rural areas. The government will the stakeholders involved – big or and an overall tele density of close be setting up over 2.5 million Wi-Fi small to showcase their expertise to 90 per cent. The government hotspots across the country to and be part of the larger system has a digital vision for India and the enable connectivity covering the that drives India forward, digitally. strategy is premised on access and urban and rural areas. Wishing you all the very best. inclusion, giving a digital identity to everyone and delivering next Adaption of technology, whether generation goods and services to applications or services, is best all citizens. understood in the local languages. We are also working on a mass The National Digital digital literacy program so that Communications Policy (NDCP) people at the bottom of the 2018, was approved by the pyramid will not merely have cabinet this year to lay out policy access to technology but also will and principles framework that be able to leverage technology will enable creation of a vibrant in their local language. This will competitive telecom market. The enable this section of the society key themes that the policy aims to stay connected and digitally to look at include, the regulatory informed. Aruna Sundararajan and licensing framework impacting the sector, connectivity While digitalization is progressive, Telecom Secretary and for everyone, ease of doing the connected space comes Chairman of the Telecom business and adoption of new with challenges and there Commission technologies including 5G and the should be a strong focus on Government of India IoT to accomplish the mission to security. Every nation faces cyber connect, propel and secure India. security challenges. Countries The common underlying themes like India, where digital growth of ‘Make in India’ and ‘Skill India,’ has been exponential, the would be inclusive elements of the magnitude and complexity above. of these challenges become multi-fold. A comprehensive In a connected era, easy access cyber security policy along with to information should be enabled the sectoral CERTs are the key for all citizens. We have begun building blocks of India’s cyber a number of initiatives like security infrastructure. India is BharatNet, Network for Left Wing currently working towards putting Extremism Areas, connecting a comprehensive data protection remote areas of the North East framework in place. © 2018 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Foreword It gives me immense pleasure services and revenue streams for acknowledge the efforts made by to bring to you IMC 2018. IMC all players in the ICT ecosystem. IMC and KPMG in India’s team in with its vast range of dignitaries, However, to untap its true potential making this report insightful. speakers and attendees is playing it is important that due emphasis Thank you. a crucial role by bringing all the is given by the government players in our telecom ecosystem and industry on spectrum together on a single platform. The harmonization, infrastructure future of our industry is defined creation and introducing relevant in platforms like these where all regulatory measures. stakeholders connect, create and IMC 2018 plans to focus on how innovate which strongly aligns with the trinity of regulators, academia our central theme this year. and industry can collaborate to Telecom provides connectivity CONNECT India, CREATE an that fosters inclusion, drives ecosystem for ICT players to thrive empowerment and enables and contribute to the growth of transformation. The near digital India and INNOVATE to ubiquitous reach of the mobile bring a faster growth in technology Rajan S Matthews makes it the best tool to deliver adoption, network solutions that development to the very last will allow an unforeseen socio Director General mile through ‘Digital India’ and economic development of India. COAI a ‘mobile first’ approach. It is I am pleased to inform you important for the future of India to that IMC, Cellular Operators have a robust telecom network as Association of India (COAI) along India has an opportunity to power with KPMG in India has brought ahead of the rest of the world as out a comprehensive report on a digital economy. The promise of how the New Digital Horizon is 5G is tremendous and it will be un-flolding for India. I would like to a catalyst in the evolution of new © 2018 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved Foreword Welcome to the 2nd edition of academia, industry would be a key IMC 2018: New Digital Horizons: differentiator that will make India a Connect. Create. Innovate. digital leader. The event is aimed to explore Our research paper, written by our the current dynamism in the knowledge partner KPMG in India, telecommunications sector which studies the evolution of networks has become a catalyst for a digitally of the future and dwells into how empowered and connected India. technology will be shaping our With the stupendous success lives. It identifies some of the from last year, IMC has become trends on customer expectations South Asia’s largest digital and how telecom companies are P Ramakrishna technology forum bringing evolving their business models CEO together the congregation to meet those expectations. It of regulators, academia, is clear from the report that India Mobile Congress researchers, industry leadership only companies which thrive under one roof. It is aimed to on innovation and cutting edge bring together the converging technology are the ones which will communication industry on one be able to leapfrog the exponential platform in India, to showcase growth offered by the sector. emerging opportunities and I conclude by thanking the team at trends, technologies, business IMC, COAI, and KPMG in India for opportunities, applications, working together to successfully platforms, government policies deliver this program to you. Our and initiatives. aim is to be a one-stop-shop expo India has the world’s 2nd largest destination for the mobile industry telecommunications network and in India and South Asia and internet user base. It is becoming ultimately, gain from the insights the hotbed for innovations in and partnerships forged this year telecom services, equipment in India.
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