Looking Attractive

Limited mobility and better interconnect make basic services more attractive than cellular.

FY 2000-01was the year of basic services in the country, as all the remaining service providers were able to commence their networks in full swing by setting up infrastructure in different cities. Shyam Telelink and HFCL Infotel commenced their operations in Rajasthan and Punjab, respectively, whereas Hughes Tele.com, Tata Teleservices and Shyam Telelink increased their operations in terms of the number of cities.

The total size of the basic services market in India is estimated at Rs 29,082.78 crore, an increase of 13 percent. In terms of the number of DELs, the basic services market is around 37,054,600, an increase of around 20.95 percent. With the opening up of the basic services to multiple players, this segment will see good growth in the years to come. The transition from licensing to revenue sharing and with limited mobility being allowed, basic services looked more attractive to the financial institution and also to basic service providers in the country.

Basic Service Providers

Bharat Sanchar Nigam Ltd (BSNL) has commissioned 59.2 lakh lines in 2000-01 against a target of 57.9 lakh. The company floated a tender for six lakh lines of VPT based on WLL technology, to be implemented by 2001-02. In this fiscal, the company is planning to begin cellular mobile services in a big way by going for four million lines in 2001-03.

In 2000-01, BSNL laid 54,000 rkm of OFC but this year, the company plans to lay 126,000 rkm of OFC. On the JFTC front, BSNL bought 583 lckm, but this year, the company is planning to buy 473 lckm.

Mahanagar Telephone Nigam Ltd (MTNL) has a committed provision of 3.3 lakh net switching capacity and 50,000 limited mobility connections, each in Delhi and Mumbai, in this fiscal. The company plans to invest Rs 10,000 crore in the next
five years. The government is planning to reduce its stake from 56 percent to 26 percent by the end of the year.

Bharti Telenet is present in twenty-seven cities of Madhya Pradesh and Chattisgarh. The company has made an investment of Rs 600 crore over a period of three years to create an optical fiber backbone of more than 4,000 km with five main switches having a cumulative capacity of 2,50,000. The company is yet to launch the CDMA service in the two states, as it is still waiting for a clearer picture on the regulatory front. Bharti is also the first to provide free Internet connection with every telephone and has around 12,000 registered customers. For the corporate customers, Bharti provides free Internet, ISDN lines, leased lines, centrex facility and videoconferencing. This year, the company plans to achieve a target of 1,85,000 customers by the end of the fiscal.

HFCL Infotel is operational in the urban centers of Punjab in cities like Chandigarh, Mohali, Patiala, Ludhiana, Jullundhur and Amritsar. The company has launched limited mobility service in the first quarter of 2001. On the corporate front, the company provides ISDN, leased line, closed user groups, Centrex, VPN and DSL services.

The company has already deployed 1,500 km of OFC and plans are to deploy 1,650 km of OFC in 2001-02. In terms of investment, the company has already invested Rs 700 crore and this year plans are to invest around Rs 500 crore.

Hughes Tele.com is India’s first broadband network covering eight cities in Maharashtra and Goa.

The corporate customers are provided with E1 lines, which support Direct Inward Dialing (DID) and Direct Outward Dialing (DOD), using Centrex solution. The company has also launched broadband wireless service in Mumbai.

On the infrastructure side, the company has invested about Rs 600 crore in capital assets and this year, the company is planning to invest around Rs 400 crore. Once the regulator reviews the CDMA services in the country, Hughes Tele.com is planning to go for CDMA service in their states. By the end of 2001-02, the company plans to achieve 200,000 lines.

Shyam Telelink began its operations in the second quarter of the year 2000 and is operational in Jaipur and Jodhpur.

The company has already laid 1,500 km of OFC and plans are on to deploy 3,800 km by 2002. The company has already started limited mobility services and has around 2,100 subscribers. The company plans to invest around Rs 150 crore on the limited mobility front.

The corporate customer is provided a host of services like leased lines, videoconferencing, ISDN, closed user group, centrex and Internet services.

Tata Teleservices, the basic service in Andhra Pradesh is operational in four cities—Hyderabad, Vijaywada, Vizag and Guntur—and has had a cumulative capacity of 1,30,000 lines. The company has already taken the lead and is the first private player to start CDMA service in the country and is planning to invest around Rs 200 crore in limited mobility this year. The company, presently, has 1,000 CDMA connections.

On the OFC front, the company has laid 140 km in the last fiscal and plans are to go for an inter-city OFC of around 800 km.