VSNL gives Reliance more bandwidth

Internet gateway and service provider Videsh Sanchar Nigam Ltd (VSNL) has assigned four STM-1 circuits, a 155 mbps connectivity mode, on the Flag submarine cable network to Reliance Infocomm Ltd.

"We sought a total of 15 STM-1s and VSNL has agreed to activate four STM-1S on the Flag cable network," a Reliance Infocomm spokesperson said here yesterday.

Meanwhile, VSNL sources said the company was ready to assign more capacity to Reliance Infocomm, provided rightful customers are not deprived of bandwidth.

The Tata group company controls the cable landing stations in India and is in a position to determine how much bandwidth should be released in the sub-continent.

Reliance Infocomm had earlier alleged that VSNL was not releasing Flag's bandwidth and had blamed the Tata company for scarcity of bandwidth in the country.

VSNL, in turn, had said Reliance Infocomm had sold capacity over the assigned amount, which was creating a dearth of bandwidth in the sub-continent.

Both VSNL and Reliance Infocomm had earlier written to the Telecom Regulatory Authority of India on the issue and the regulator said it would intervene if the companies do not settle the issue among themselves.

Meanwhile, France Telecom Vice-President (Asia) Jean-Francois Thomas today said with over five submarine cables and eight landing stations in India, bandwidth pricing is the next "bubble" and will have the same plight of dotcoms that burst by mid-2000.

"The bandwidth prices in the country are expected to fall as broadband majors and telecom companies are expected to undercut each other, which apart from resulting in losses to the players will also create chaos," Thomas said.

Maintaining that it was "wise to avoid" the pricing issue by sticking to a business code of conduct, he said the prices were expected to fall "drastically" within a couple of months.

Analysts say the prices of STM-1s (a 155 mbps circuit) had fallen to $2 million from $5 million a year ago, while that of DS3s (a 45 mbps circuit) and E-1s (a 128 kbps circuit) had slid by over 60 per cent.

This trend was likely to continue during this year, Thomas said.

With the proposed Southeast Asia-Middle East-Western Europe-4 (SEA-ME-WE-4) submarine cable network becoming operational by 2005, India would have abundant bandwidth by next year, he said.

SEA-ME-WE-4 is slated to have two landing stations, one in Mumbai, which will be set up by VSNL, and another in Chennai proposed to be set up by Bharti Tele-Ventures.