Videsh Sanchar Nigam (VSNL), the Bharti group and the Tatas may abstain from bidding for a strategic stake in Satyam Infoway, the Nasdaq-listed Internet service provider (ISP) arm of Satyam Computer Services.
Senior executives from the country's three largest ISPs said they do not want to look at Sify at this stage given the sluggish economic conditions.
Though Satyam Computer has said it could offload 52.5 per cent in Sify in full or in part, none of the three firms has yet been approached by the software major.
Both VSNL and the Tatas have said they will expand their ISP business organically and through acquisitions. VSNL, in fact, has kept aside Rs 100 crore for expansion.
While VSNL is the largest ISP in India, Bharti's Mantra Online figures in the top 10.
Bharti Televentures chairman Sunil B Mittal told Business Standard recently that Bharti does not want to acquire any ISP though many are going cheap.
"Satyam has a major presence in India, but it has invested heavily in infrastructure and content without adequate returns," he said.
A senior Tata executive said, "Though Tatas are open to acquiring content companies and ISPs with a special focus at a later stage, we do not want to burn our fingers for the time being. However, Sify has exhibited its strengths even during bad times."
Analysts said a major negative could be Sify's huge debt following the acquisition of IndiaWorld Communications for Rs 499 crore.
This response from potential buyers, according to analysts, is a reflection of the recent developments in the ISP market with several players struggling to survive. Hence, a wait-and-watch approach could lead to cheap buyouts in the near future.
"VSNL has major plans to improve its content-base that can be provided by a company such as Sify. But we have already acquired a number of home and business customers over the last few years despite competition from private operators," a VSNL official said.