Investing in Telecom Infrastructure: Emerging Opportunities in July 2019
Explore the potential investment opportunities in the telecom infrastructure layer in July 2019, with a focus on the rapid growth of the digital economy, the need for increased capacity, and the importance of carrier-neutral infrastructure to support common access players in India.
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Investment Potential new emerging areas Telecom infrastructure layer July 2019 All disclosures are based on best known public domain information and is for illustrative purpose only. LTV or it affiliates takes no responsibility for any accuracy in formation expressed or implied in this document. The recipient shall have the right to view this information for the purpose for which it is intended and disclosed. All trademarks and logos are respective to the organisations. 1
LARGE DIGITAL ECONOMY .SKYROCKETTING USAGE, CORE INFRASTUCTURE CAPACITY LAGGING FAR BEHIND A KEY INHIBHITOR TO GROWTH By 2025, digital economy expected to be $1 trillion As % of GDP 18-23% Size $413bn As % of GDP 15-16% Without IT/ITeS <$250bn As % of GDP 8-10% India Digital: An overview Digital usage increasing at rapid pace Installed Data Center ( MN Sq Mtr) International Comparison of Fiber Assets India China US 17 1090 Infrastructure build is falling behind; lowest per capita fiber installation and lowest per capita (internet user) DC 420 2 126 0.2 75 43 25 US China India Total Fiber Installed (million Fiber KMs) Fiber km per Sq km of area Parameters Parameters India China US US China India Fiber KM per Capita 0.06 0.87 1.30 Nos of Internet users (MN) 300 850 500 2
DATA (DIGITAL) USER EXPERIENCE AND COST OF DEPLOYMENT IN INDIA Very Large user base ( digital usage) Heavy Usage ( digital usage) Low deployed deploying High cost content capacity of QoS Low 3
ABOUT 18-20 B USD INVESTMENTS NEEDED TO PLUG CAPACITY GAP Capacity needs to double CURRENT INSTALLED CAPACITY ESTIMATED INVESTMENTS TILL DATE ( last 20 years) ESTIMATED INVESTMENTS IN NEXT 3-5 YEARS INVESTMENTS MULTIPLE IN NEXT 3-5 YEARS DATA CENTRE ~800 MW 3-4 B USD 5- 6 B USD 1.1-1.2 x SUBMARINE 7 Cables ,50T 1 B USD 2-3 B USD 2-3 x TERRESTIAL FIBER ~10 Lac RKM 1CR FPKM used capacity (<15%) 10-12 B USD 10-12 B USD 1 x 1.5-2 x the investments made so far over last 20 years needed- in next 5 years only 4
CARRIER NUETRAL INFRASTUCTURE LAYERS SUPPORTING COMMON ACCESS PLAYERS Non discriminatory open market based price and access to network FUTURE STATE CURRENT STATE Underlying policy and regulatory framework .WILL PROVIDE INDIA THE ADEQUATE INFRASTRUCTURE RETURNS TO SUSTAIN RAPID GROWTH 5
RECCOMENDATIONS 1. SEGREGATE INVESTMENT CASE AND POLICY SUPPORT : ACCESS NETWORKS v/s CORE NETWORKS Core network =terrestrial fiber , submarine, data centers = wholesale & enterprise Access infrastructure = towers, spectrum , wireless = consumer , home broadband. 2. CRITICAL INFRASTUCTURE CATEGORISATON BENEFITS To support this large capacity build out needed policy support to IP1 To support this foundational block for future access technology modernization -5G,IOT. 3. OPEN CABLE SUPPORT FOR SUBMARINE AND ILD. 4. FACILITATE FASTER RESOLUTION PROCESS FOR M&A and IBC PROCESS 7
THANK YOU Amajit Gupta All disclosures are based on best known public domain information and is for illustrative purpose only. LTV or it affiliates takes no responsibility for any accuracy in formation expressed or implied in this document. The recipient shall have the right to view this information for the purpose for which it is intended and disclosed. All trademarks and logos are respective to the organisations. 8
