Maran predicts bandwidth boom

Major changes are underway in the limited-competition high-capacity bandwidth industry in India.

Major changes are underway in the limited-competition high-capacity bandwidth industry in India. The telecom PSUs BSNL and MTNL have now decided to jointly construct an international overland cable system to link India with Malaysia and Singapore.

In addition, the Indian government has renewed its bid for international cooperation to bring down prices at landing stations where international high capacity cable systems converge.

Telecom and IT Minister Dayanidhi Maran said today that BSNL and MTNL8217;s new cable system will be the first to be built over land routes from India. It will also be the second time that the two telecom PSUs will team up for a major cable project.

8220;BSNL and MTNL and jointly conducting studies to create a land route to Malaysia and Singapore, such attempts will bring prices of bandwidth down in line with prevailing market prices,8217;8217; Maran told reporters at the launch of Falcom, a new fibre-optic submarine cable system that will interconnect with Flag Telecom8217;s existing global network.

Flag Telecom, owned by Reliance Communications, is to manage the entire design, construction and operations process for this new 6,900 km system with a capacity of 2.56 Tbps.

Over the last two years, the Telecommunications Ministry has made several efforts to bring down bulk bandwidth prices in order to lower individual Internet connection costs as well as benefit the IT services sector, which is a major bandwidth consumer. These attempts have yielded few results, partly because India8217;s high capacity bandwidth industry is run by a handful of companies: Reliance Communication, BSNL, Tata VSNL and Bharti Airtel.

8220;There are only four Indian bandwidth providers, while there are 33 in England, 32 in the US, 24 in France and 14 in South Korea. There have to be more international bandwidth providers in India to make the market even more reliable and cost effective,8217;8217; Maran said today.

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Demand for bandwidth is likely to go up in India by 40 or more a year if the current pace of growth is maintained. However, the government and telecom regulator TRAI are keen to bring down access costs as well as the prices at landing stations, which hike the prices of bandwidth for consumers and industry.

8220;We need to work to bring down prices at landing stations. Every country charges differently today, leading to high costs, which the consumer ultimately end up paying for,8217;8217; Maran said in his address to senior government officials from Oman, Bahrain, Saudi Arabia, Kuwait and Egypt, at the launch of Flag Telecom8217;s new cable system today.