But broadband hasn’t yet experienced such competition and private telecom companies, which own a majority of the broadband licences, have been reluctant to invest in reaching optic fibre to the consumer because they fear the returns may take longer than expected. The biggest deterrent has been the cost of the last mile, which is as high as 90 per cent of the total cost of wireline to the company. “Even if the user-end cables are laid, it would be uneconomical to provide broadband services to customers at rates they can afford,” says VSNL’s vice-president of corporate strategy, Srinivasa Addepalli.

Instead, private telcos have suggested that the government allow them access to the last mile network of the largest landline operator, BSNL. But successive telecom ministers have shot down the demand. “Unbundling is tricky,” says BSNL’s director of finance, S.D. Saxena. “Everyone wants to keep control over the asset. We on our part would like to keep it with ourselves.”

The answer, perhaps, lies somewhere in between — raise competition in broadband, not necessarily through unbundling but by allowing non-telecom players to offer the last mile pretty much like ISPs offer their services. India could also follow the Korean example where the government took the lead in offering free broadband to the masses. US cities such as San Francisco and Philadelphia have also begun offering free broadband to citizens.

Much of India’s broadband conundrum is likely to get resolved if the spectrum can be thrown open to Wi-Fi and WiMax services, which offer high-speed wireless broadband at 20 mbps and 70 mbps, respectively. Although companies such as BSNL, Mahanagar Telephone Nigam Limited (MTNL) and Bharti have been conducting trials on these technologies, their nationwide rollout has been stuck because India is still to release spectrum. Only a handful of cities such as Bangalore and Pune offer Wi-Fi in pockets.