Last year, aspirant Internet Service Providers (ISPs) formed an association to address common issues before them. Their stated aim was to "provide datatone for all". Early this week, representatives of the association met Telecom Regulatory Authority of India (TRAI) functionaries to discuss some of the problems faced by them. R Ramaraj, president of the association and the managing director of Satyam Infoway spoke to Vidya Viswanathan about some of these issues.
Q: What are the infrastructural hurdles you face currently?
A: If there are no blooming roads what is the use of manufacturing cars? For Internet service, you first need telephone lines. If a consumer has to dial up an ISP, the ISP has to have a free phone line. VSNL has no phone lines and has stopped issuing Internet connections these days.
Also Read
Q: How many customers can you service per phone line?
A: International norm is 15 per line. But I suspect that VSNL does more like 50 to a line. We would be all right with 15 if we have to service corporate customers. We are now talking about two million Internet subscriptions in the country. At Satyam we are aiming a 10 per cent market share which is about 200,000 subscriptions. This means we need 15,000 telephone lines and perhaps 1,000 in a city like Delhi from one exchange. This is not available now, so what we are telling MTNL and DoT is to give data priority and treat us as privileged customers. We have told TRAI that we want a separate numbering plan for ISP connections and also revenue sharing.
Q: Are your subscription rates going to be lower than that of VSNL?
A: VSNL rates at Rs 10,000 for 500 hours match international rates. Rates in the US are either $22 per month or $9.95 per month and an hourly charge over that. Private ISPs will have to pay to connect to the nearest DoT or MTNL switch which will link us to the VSNL port or to any other gateway. We have to pay 10 times as much tariff as any other ISP in the world to connect to DoT. Then, connecting to an Internet port costs Rs 72 lakh for 2 megabytes (capacity) as against Rs 15 lakh for any other ISP in the world. We should be allowed to uplink to any other gateway.
Q: What is to be done to reduce costs?
A: Well, TRAI in its new tariff papers has indicated that it will bring down charges by about 80 per cent. If it does not, we are not viable. What we want _ and the IT task force is considering _ is permission for anyone to put up a data backbone. A quick alternative is to let V-Sat do so.
Q: In how many years will Satyam break-even if all this goes through and you get your license next month?
A: We have invested Rs 20 crore in this. The company has equity of Rs 15 crore and debt of Rs 25 crore. We will break-even in three years. But we are depending on e-commerce for the business and will host several content sites. We already have a Carnatic music site (carnaticmusic.com), movies site (indiatalkies.com) and a political forum (indiaupdate.com).