VSNL may lose BSNL's ILD traffic

Telecom firm may not renew exclusivity deal

Videsh Sanchar Nigam Ltd (VSNL) may no longer remain the exclusive carrier of international long distance (ILD) traffic for Bharat Sanchar Nigam Ltd (BSNL).

BSNL, which has 40 million subscribers, is exploring alternative arrangements with ILD operators like Bharti Infotel, Reliance Infocomm and Data Access. BSNL's exclusivity agreement with VSNL expired on February 14.

Earlier, BSNL had said it would continue to use VSNL's ILD infrastructure until it built its own network.

According to industry sources, even as BSNL was exploring other options to VSNL's infrastructure, it had to also put in place settlement agreements with foreign carriers for ISD pricing.

They said BSNL might leverage the international agreements of Data Access and Bharti until it negotiated the settlement agreements since they offered lower rates compared to VSNL.

"Our ILD licence has become operational as on Saturday. We are finalising our rollout plans since we have to launch services before March 30. We are exploring options other than VSNL. It all depends on who will offer better commercial terms and conditions," said a senior BSNL source.

Bharti, Reliance and Data Access have already pitched for routing BSNL's ISD traffic.

Executives in the three companies said they had no indication from BSNL on how it would finally route its traffic.

ILD traffic from BSNL has been a contentious issue ever since VSNL was privatised. Over 90 per cent of VSNL's revenues come from BSNL's ILD traffic.

If BSNL decides to move away from VSNL it can sound the death knell for the Tata company.

"We have time till March end to begin our ILD services. We would be opening our cards closer to the launch date," said a BSNL official.