What is contending traffic actually? If a 1mbps line is shared among 10users that's what I understand about contention ratio then 1024kbps/10users=102kbps but TRAI guideline is to provide 80% that is min 768kbps so how cum its possible?
Whoa whoa, stop there. That's not how contention works. It's not "if there is a 1mbit's line it's shared between 10 users" because it's not contention at the last mile that we're worrying about here, it's contention as a sum of the total available bandwidth, as in "if the ISP has 1gbit/s to the outside world, therefore a contention of 1:10 means they should not sell more than 10gbit/s worth of service", although the rules state that they could sell up to 50gbit/s worth of service if they really wanted to.
How much is 10gbit/s of service going to be? Well, that is entirely up to the ISP and what plans he wants to provide. If he decides on 1mbit/s plans at a 1:10 contention ratio, that's 10,000 customers. Or 10mbit/s customers is 1,000 customers. Or 100mbit/s for 100 customers. And so forth. The higher the speed, the higher the contention ratio needs to be to justify it economically BUT CONVERSELY, the less the customers are likely to notice.
As for the 80% rule, if an ISP sells you a 1mbit/s line they are obliged to provide up up to 80% of that - within their network but to the outside world the max they can guarantee you is about 20kbit/s for every megabit they sell you, so a Speedtest result that gives you only like 0.4mbit/s during peak hours is actually not a violation of anything if you can still get >0.8mbit/s to a server within your ISP's network. Or, if you're on
ADSL and your line syncs at 80% of the speed it's considered to be OK (so if you're promised 1mbit/s and your modem syncs at 805kbps or so, you're within the limits and nobody is likely to care if you complain).
Unfortunately, many of the TRAI guidelines are actually too difficult for your average person to measure and desperately need clarification - this goes for the "80% rule" as well as contention ratios, because both are frankly too easy to fudge.
I read somewhere on the internet that BSNL shares a 33mbps line to 300users across an exchange.
This is different again. How BSNL contends it's bandwidth is their own thing, but typically a DSL line is given x amount of bandwidth as a committed information rate, and the speed you're sold is a burst speed. This is probably the case with BSNL (and other operators) but because the burst speed is not significantly higher than any CIR they might have (and that they have slow unlimited plans), slowdowns are more noticeable for more time during the day.
I don't know BSNL's numbers, but in NZ, ADSL lines get 45 or 90kbit/s as a CIR even though most of the time I would get 16+mbit/s were I to be downloading something (locally... information from the US or Aussie is an entirely different matter). Basically though, because there are hundreds of lines connected to an exchange or cabinet, you're able to get these kinds of speeds much of the time: if a cabinet serves 500 homes, you're looking at say 45kbit/s * 500 = 225mbit/s or so is supplied to that cabinet.
Obviously 10 or 12 users downloading simultaneously would saturate that upstream but because the attainable speeds are usually 16+mbit/s, it means download times are short, so you have a 1 gigabyte file coming down in a few minutes and then the lines are free for the other 490 customers. Most of the time, nobody ever even notices speed drops except when a lot of people in one area are on a particular ISP that does offer "unlimited" then their speeds drop right from 16+mbit/s to like 0.5 or 1mbit/s... but the rest of the ISPs that don't offer unlimited manage to keep relatively consistantly high speeds.
This is why I agree with fair-usage policies in principle but so long as the limits are fair and reasonable to the customer - and the speed of the line is not limited. I'd rather share a 100mbit/s line with 100 people than have 1mbit/s to myself (statistics suggest I would probably get at least 10mbit/s most of the time).