Gujarat Cos Get Vsnl Franchise To Provide Internet Services

Even as hopeful private Internet service providers wait for the announcement of an Internet policy by the department of telecommunications (DoT) that will lay down the rules for private Internet services in the country, Videsh Sanchar Nigam Ltd (VSNL), Indias sole Internet service provider, has already franchised two private service providers in Gujarat.

Wilnet Communications and Babool Technologies, both based in Ahmedabad, have been selling access to Internet through the VSNL gateway in Mumbai to customers across Gujarat charging the same tariff as the public sector company, much to the chagrin of other aspirants.

According to VSNL director Amitabh Kumar, the two companies were allowed to provide access and support in Gujarat after the approval of DoT.

 

What is the need for a policy then? asks an angry executive at one of the largest e-mail service providers in the country. Others should be allowed to set up services in other states too.

Wilnet Communications is a subsidiary of the Cadila pharmaceutical group, which also distributes wireless local loop products.

According to senior VSNL officials, Wilnet and Babool Technologies have invested nearly Rs 2 crore each in equipment.

Amitabh Kumar denies this. The equipment belongs to VSNL. We are just using their premises, he says.

The routers and other Internet access equipment in the premises of the two firms is tantamount to allowing them to set up their own services, though the access is through VSNL, which is the countrys sole international telecom carrier.

The two companies also insist that they are simply marketing agents for Gujarat, selling and providing technical support to their customers.

Industry executives cannot understand why VSNL has appointed agents in Gujarat, which was outside its mandate.

In August 1995, VSNL was allowed by DoT to provide Internet services in six cities: Mumbai, Delhi, Calcutta, Chennai, Bangalore and Pune. Subsequently, it appointed marketing agents to sell the services and support customers in these cities.

Then there is the case of shared revenues. Senior VSNL officials admit that there is a 50:50 revenue sharing arrangement with the two companies.