With telcos putting their own infrastructure, RailTel targeting non-telecom players

RailTel Corporation of India Limited, Indian Railway-owned bandwidth provider, plans to provide telecom data services to non-telecom players. The move has been prompted by the fact that telecom operators have built their own optic fibre infrastructure, resulting in 20 per cent squeeze in RailTel's business.

At present, the company gets 60 per cent business from telecom companies, 20 per cent from government sector, 10 per cent from the railways and 10 per cent from others. It now wants to grow in the government and enterprise sectors in order to reduce dependence on telecom operators.

R K Bahuguna, managing director, RailTel, said, “We are making good of that loss by diversifying into other areas and looking into opportunities in government sector. We are looking for network support, primarily in National Informatics Centre, defence, railways and other PSUs.”

Even today, RailTel is the preferred back-up optical fibre cable provider for telecom operators in the event of redundancy of bandwidth by telcos despite their own telecom network. In case their network fails, RailTel's network is there as an alternative, he added.

RailTel is also pitching in for national knowledge network (NKN) with high capacity 10 Gb bandwidth pipes in core network in multi-operator environment, connecting all premier institutions, universities and research and development centres in the country. The project was approved by the government at a cost of about Rs 6,000 crore. “RailTel is connecting 350 institutions out of 1,500 planned under NKN. We have connected 250 institutions and on 100, work is in progress,” said Bahuguna.

RailTel is also participating in building National Optical Fibre Network in partnership with the state-owned Bharat Sanchar Nigam Ltd and Power Grid. The total cost of connecting 2,50,000 villages is about Rs 20,000 crore. It is also implementing Universal Social Obligation Fund (USoF) project in six states of Northeast, except Assam. By 2014, about 12,000 km of fibre is expected to be laid at Rs 400 crore.

The department of telecommunications is yet to distribute all these panchayats depending on certain logistics, availability of network/fibre and there is a high level committee that is already working on it, headed by Sam Pitroda.

RailTel expects to get about 20-25 per cent of the business of the total Rs 20,000 crore in the USoF. UsoF is the fund in which telecom operators contributes about six per cent of their revenue and this fund is expected to be used to develop network in the deep interiors of the country. The orders of the government are yet to be issued.

As directed by the ministry of railways, RailTel would also be rolling out broadband services across the country through public private partnership (PPP) model. Until the stations, RailTel has its own network. For the last mile connectivity, the access network would be provided on PPP basis to reach the small and medium enterprises and retail customers, wherein RailTel would provide the core network and data centres. The proposal is under examination by the ministry of finance and planning commission and is likely to be finalised soon.