Enterprises have long been allowed to use managed voice-over-IP (VoIP) networks within closed user groups (CUGs), and there has been no restriction on licensed voice service providers using IP as an underlying technology to offer services. So what does the recently announced DoT guidelines for setting up Internet telephony services imply? Simply put, it means that service providers (ISP license holders) can now offer voice services over the public Internet—something that was illegal earlier.

The new guidelines obviously have positive repercussions for both the ISPs and the enterprises. ISPs will benefit from the fact that the entire value proposition of the services they offer will change with the legalization of Internet telephony. They can look forward to new revenue-generating streams. They can also benefit from the fact that new applications, especially cheap domestic and international voice, will result in users spending more time on the Net, and hence consume more bandwidth. Besides, services like VPN can be made more efficient and cost-effective by voice enabling them. "For ISPs, this means that they now have the permission to offer one more application and service to their subscribers, targeting retail and enterprises.

The new regulation is not likely to create much impact on the existing voice market in India, especially in relation to the business of the existing fixed service providers. Most of the basic service providers as well as international long distance licensees who also hold ISP licenses, are likely to use the public Internet to offer a cheaper voice alternative and may bundle the service with the existing PSTN voice. How much impact this can create is not clear now, given the country’s abysmally low PC penetration, since usage of the PC is central to DoT guidelines. "I think PC penetration is an important factor, and so Internet telephony will not have much impact on the consumer market,’’ Ajit Thatte, V-P, marketing, Tata Telecom, says. Also, it is a fact that wherever Internet telephony has been allowed worldwide, it has created a new market for itself. People who are most likely to use Internet telephony are those who have little regard for quality or those who are going to be the first-time users of international voice services.

As far as enterprises are concerned, there would not be much change for those who could afford to invest in their own networks as they have been allowed VoIP over CUG all along. Even prior to the announcement of this policy, they could set up a single network to offer voice and data services as long as the network and its services were restricted to CUGs. However, Yadav points out, small enterprises who could not afford to set up their own networks, can now avail this service over a service provider’s IP network, and thus benefit greatly. Manish Sablok, national marketing manager, Tata Telecom, has another point to make: "Now that the government has allowed Internet telephony, enterprises will be more receptive to the technology. Opening up will give us an opportunity to demonstrate the benefits of IP."

Ravi Shekhar Pandey