Madan Mohan Rao

The telephone is one of the keys to social equity in rural India. Through the simple and cost-effective GramPhone, Madan Mohan Rao intends to move villagers from the periphery into the center of communications policy and practice, and simultaneously into the center of public life.

Rural Telecom Foundation (RTF), of which Madan Mohan Rao is one of the founding members, has created a system to bring telephones to rural India for the mutual benefit of households, small business people, state-run service providers, and the government, while subtly creating important shifts in relationships among families and villages. Through a series of experiments, the RTF has created the GramPhone—a cheap and easily run village-based exchange that takes into account the short-distance communication needs of rural people.
The copper wire, switchboard and handsets that together make telecommunication possible are the material elements of RTF’s idea; and the conviction that lasting social change can be brought about through expanding the means of communication is its substance. Over 90 percent of India’s rural households still do not own a telephone. As someone who is closely associated with rural Andhra Pradesh, Madan understands how this condition inhibits or thwarts economic entrepreneurship, new social transactions, and the ability to respond to crises that telephones allow. Through telephones, rigid caste, class, and gender hierarchies are being gently but irrevocably displaced.
The GramPhone works because it harnesses existing materials more efficiently than the conventional telephone system, overcoming the problems of cost and scaling typically associated with rural areas. By improving the prototype, Madan has made the GramPhone commercially viable for all parties: the user, branch operator, and the state corporation that owns the lines. Rural telephones generate money for the national economy, meet policy objectives, and serve as a simple and practical way for millions of people to fully participate in the day-to-day affairs of their neighborhood, region and country.

“The telecommunications network in India has not been built to serve the needs of over 90 percent of people living in rural areas,” says Madan. “It currently serves only the interests of the rural elite, who desire connectivity to town, city, national and international networks.” In essence, most people living in rural areas don’t have phones because the current telecommunications network does not have the capacity to serve them.

Although national telecom policies established in the 1990s considerably boosted the number of telephones in India, they did not greatly affect spread. Thus, most telephones remain in the hands of the urban middle class. The irony is that while one family in Mumbai shares four or five mobiles, an entire village in Andhra Pradesh has nothing. Telephones in rural areas are largely owned by the landlords and businessmen, and the poor and Dalit or tribal village residents are totally denied access. While scattered public call offices do allow villagers to make calls, they are clearly limited in their ability to service incoming calls. In addition, the current telecommunications system is designed to reach the nearest town, but does not connect people within the village to each other nor to their immediate neighboring areas. Thus, much time and energy is spent traveling to spread news related to births, marriages, deaths, etc. The service provider methodology fails because it relies on a single delivery system for all of India with no consideration for local factors.

Although changes in the telecommunications policy have opened up the rural telecommunications market, little interest has been shown by the private sector, partly because of conventional assumptions about rural market demand and partly because these regulatory changes are based upon overseas models that are ill-suited to India. And even in cases where private companies are entering the rural phone markets, their efforts do not initiate the important structural changes that Madan is seeking. Most are working with wireless technology, which is likely to be more expensive and difficult to manage than a series of short connections from a nearby exchange. In addition, a landline is accessible to everyone in a family, particularly the woman of the household, who does most of her work in or near the house, whereas a mobile phone frequently travels with the man of the household.

Like the private sector, government policies in rural telecommunications continue to be characterized by institutional barriers and general disinterest. Rural phones are still understood primarily as a means for communicating across large distances, rather than across a few houses or streets. Add to this the usual obstacles posed by India’s famously inefficient and corrupt bureaucracy, and the only solution, in Madan’s view, is to remove ownership and control as far as possible from the hands of government into the hands of the users. “We have to devise a model that will not rely on the bureaucrat or the politician to work,” he says.

Although Madan has been experimenting with rural telephony for years, his work specifically on the GramPhone took off in 2000, when he and a number of partners began the Rural Telecom Foundation. Their model was innovative and unique in its long-term viability because the technology was simple, the business planning informed, and the costing rigorous.

The GramPhone, or ‘village phone’, is essentially a modified party line, simple and robust. Developed for the foundation by two telecommunications experts, it operates through the local branch exchange, utilizing the existing infrastructure and making only minor adjustments to the circuitry and ringing system. An electrician, carpenter and linesman can install the system in a short time. It requires no independent electricity supply at point of installation, and therefore does not need the extra equipment normally used by BSNL when establishing a telephone exchange.

Madan has found that the system works best when owned by the local branch operator. When operators are also owners, they ensure that dues are collected, bills paid, and lines maintained. Public call office operators prove to be most suited to be owners of these lines, as they are known locally, accessible and already have a telephone line. Opening an exchange requires only a small initial investment. After one branch is in place, others soon follow; each village can readily accommodate a number of exchanges, and the larger the number of connections, the lower the costs. With increasing national competition among telephone companies, it is likely that costs will drop even further. Not surprisingly, the GramPhone has attracted the interest of local microcredit groups, Dalit, tribal and women’s organizations, and other groups working to further village-level enterprise.

The spread of Gramphones to new users in a village has occurred quickly throughout all social groups. Only those who can already afford phones under the existing system have not subscribed. The model has proven to be financially sound while addressing the specific needs of rural users. It can facilitate unlimited calls over a short distance for a flat rate that averages less than 5 percent of the household’s monthly income and requires no subsidies. Presently, outgoing calls can only be made from the operator’s booth, a drawback that Madan intends to address once the system in fully functional.

Madan’s biggest challenge has been to shape his idea to fit within the existing BSNL network and current government regulations. The GramPhone is presently operating on the existing and massively under-utilized network, a gigantic investment that is going to waste for want of users, because of misguided policies and poor management. Madan’s approach entails a degree of risk. The GramPhone has entered the network without formal permission from the government because telecommunications ideas that formally seek government approval are invariably refused, no matter how viable. Therefore, Madan’s strategy is to have 500 exchanges fully operational before going public. Once the system starts functioning on a large scale, it will be much harder to shut down, and there will be physical proof of its effectiveness. Madan asserts that because the GramPhone requires no new large-scale infrastructure, BSNL can immediately earn one-and-a-half times its break-even revenue at one fifth of the cost.

Cognizant of the arbitrary decision-making of the Indian government and its agencies, Madan is unwilling to leave the future of the GramPhone to chance: he is now preparing an auxiliary plan. In a 2001 report, a group of students from the National Law School, Bangalore, concluded that the incipient GramPhone was not illegal; however, Madan wants this opinion soundly reaffirmed before going public. Further efforts are on to reinforce the earlier research; and, once it is ready, it will be reviewed by a senior advocate and three retired Supreme Court judges, including a former chief justice. Needless to say, Madan is convinced he will eventually have the legal framework needed to take the GramPhone nationwide. Numerous local, development and civic organizations have agreed to support the project once it receives the stamp of approval.

“Why doesn’t the phone work?” Madan Mohan Rao started to ask in the 1970s, while living in one of the only three houses that had a telephone in a village in Andhra Pradesh. More often than not the 70 kilometer line that connected the house to the exchange in town had a problem, and problems with the line meant problems for the villagers. Madan would often contemplate this problem while he rode in a bullock cart and then walked to his ancestral home in the village during school vacations. “My determination to solve these problems increased because of a series of deaths that may never have occurred if a good telephone system had been in place,” he recalls.

Madan went to work as a journalist in Delhi in 1986. His office happened to be next door to the telecommunications ministry. A friend of his worked there and he was able to read the government documents, which led him to the realization that bureaucrats had no idea what was needed to get telephones to Indian villages. It was a problem with which they could not identify in the same way that Madan could. This realization motivated him to start seeking out a solution of his own.

Madan naturally began experimenting in his own part of Andhra Pradesh. At first he tried to work within the existing system, convincing several villagers in a single area to subscribe for telephones so that service providers had incentives to open new exchanges. When this failed, he tried to appeal directly to local governments, a strategy that had no potential for scaling. Finally, after a series of further experiments, in 2002, Madan left journalism and began devoting himself full time to ensuring that the GramPhone became a reality.

Although Madan is passionate about rural telecommunications, he is interested in all forms of rural development such as transport, commerce, water, and education. He studied the movement of buses in and out of his Mandal (sub-district) and proposed that the routes be reorganized around a hub. Services were increased more than 10-fold across greater distances to more villages, earning a larger profit for the transport company. He has also been involved in building new link roads, establishing a market yard, and electrification of agricultural wells. His family has converted their ancestral house into a school that aims to overcome caste and gender discrimination. The school gives priority to the girl child and 50 percent or more of those admitted are girls. Deserving children on scholarship while the rest pay only a nominal fee. The school aims to place every graduate into some form of further education.

Madan is very methodical and meticulous about everything that he undertakes, and this applies to his acceptance of the Ashoka Fellowship too. When first approached by Ashoka, he set out to learn everything he could about the fellowship, reading literature and asking numerous questions until he was satisfied that it was right for him. “If you add a letter to my name, it becomes ‘madman,’” he comments with a smile. “I have often felt like the odd one out, the mad one. But when I read about the work of the Ashoka Fellows, I sense the role of innovators in societies everywhere. Whereas earlier I felt isolated, I now see my work in relation to others around the world—so Ashoka has already made a contribution to me.”