Asia's green mobile charge

David Taverner
Wireless Asia

The Asian mobile sector has grown at unprecedented speed over the last 10 years. The number of connections in Asia has exploded from 226 million in 2000, to 2.4 billion today and onwards to a forecast of 3.6 billion by 2014. In 2001, China overtook the US to become the largest cellular market in the world, and India overtook the US in 2008 to become the second. In June 2010 the Asian region represented 47% of the global market.

Future subscriber growth in Asia will be driven by accessing the rural market. In India, in December 2009, 88% of the urban population was estimated to have a mobile connection, compared to only 25% for the rural people. Operators across Asia are racing to capture this rural segment but face significant market and power challenges, which is driving innovation in green networks.

Asia faces some significant challenges to expand the subscriber base. Taking India as an example, ARPU is typically declining, from $7 in 2005 to $3 in 2010, but minutes of use is amongst the highest in the world at 378 minutes per month. The markets can be highly competitive. In India 15 operators have driven call rates down to some of the lowest in the world with effective price-per-minute calls below US$0.01.

These market challenges are coupled with severe power shortages. South Asia has the largest off-grid population in the world with 614 million people or ~40% of the population and this alone poses major issues for running mobile networks. Lack of stable grid drives the deployment of vast numbers of diesel generators for primary and backup power.

The Indian telecoms sector consumes 2 billion liters of diesel every year to operate these towers, second as an industry only to the Indian railways. These power challenges place huge financial pressures on the mobile sector, the energy bill for an operator can be 40% of network opex, or $500 million in the case of Bharti-Airtel.
 
Enabling rural expansion

Over the past few years operators and tower infrastructure companies across the region have focused their efforts shifting to the use of renewable energy, such as solar and wind power. Base stations powered by renewable energy have almost zero opex, are virtually maintenance free, do not involve delivering volumes of diesel through monsoons and have significantly reduced carbon emissions.

This transformation is allowing expansion of mobile networks into rural, low ARPU, off-grid regions where the running costs of a diesel powered base station would have previously prevented the base station being built.

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