Gujarat ahead of AP, Karnataka as ISP destination — Survey

While Calcutta with about 13 ISPs and low net penetration level has emerged as the least popular destination for internet business among top eight metros in the country, Mumbai with 34 ISPs has been identified as one of the hotbeds for internet operations followed by Bangalore with 29 ISPs.

Delhi and Ahmedabad come next with both housing as many as 28 ISPs respectively. Hyderabad alias "Cyberabad" is a poor fifth among the big eight metros with 25 ISPs.

On the whole penetration of internet is substantially higher in the metro cities and most ISPs intend providing service in one or more of top eight metros, the survey based on the feedback from 138 ISPs across the country noted.

Scanning the customer focus of ISPs it said that most players are providing services to the business segment and 72 per cent of ISPs are focusing on small and medium enterprise (SME) segment and 62 per cent on the corporate segment.

With only 67 per cent of the ISPs targeting the home segment, the survey pointed out that small office home office (SOHO) is way down the priority list of the players who prefer to operate in the business segment.

The IMRB internet survey further said that about 17 per cent of the ISPs are providing services to other smaller ISPs and 45 per cent are catering to the cybercafe market.

Predicting that in the coming years the ISPs would continue to focus on business and not the home segment, it said "even currently only a few large players are in the home segment and these are players with a strong brand pull."

According to the survey 28 per cent of ISPs would focus on the cable operator market in near future as against 20 per cent at present. The study further said that the ISPs in the country are now graduating to value-added and dedicated services beyond vanilla internet access.

While the main value-added services being provided currently are web hosting, designing and web co-location other services like virtual private networks (VPNs) and application service providers (ASP) would be the key services provided by players in near future.

The study further points out that about 68 A, B and C category ISPs are currently offering web hosting services and the figure is expected to increase to 112 by early 2001.

Over the next few months about 97 ISPs would offer Web designing as a value-added service as against 63 ISPs now, the survey said adding as many as 56 ISP would soon enter the VPN segment and 43 the ASP market.

On the access mechanism it said that although most of the ISPs are currently providing access through dial up, leased line and ISDN mechanisms, in near future cable and wireless would develop as popular access mechanisms.