Vsnl Plans To Increase Internet Capacity

The Videsh Sanchar Nigam Ltd (VSNL) plans to do away with the popular Internet shell account to promote the full-fledged TCP/IP account as a cost effective alternative to its Internet business even as it invests Rs 80 crore as equity in a new subsidiary for providing seamless value-added services.

VSNLs plans to set up a new company and scrap its shell account follow the Internet policy announced recently by the government which called for unlimited number of independent service providers (ISP) of Internet.

Besides acting as an effective ISP, the new subsidiary will focus on providing value-added services like video conferencing, ISDN, EDI (electronic data interchange) and frame relay, VSNL sources told Business Standard here.

 

The idea to do away with the shell account has come at a time when VSNL plans to revise its Internet cost structure. It plans to reduce the current TCP/IP account charges of Rs 15,000 to Rs 10,000.

The reduction in TCP/IP account should take care (of any disadvantage arising out of the scrapping of shell account), they said.

The revision plan has come following coming down of the cost of network along with increase in customer base.

However, VSNL sources added that if the new subsidiary failed to attract 50 per cent of the Internet business in India, the service will not be feasible in the long run.

VSNL is also planning to set up a bigger backbone connectivity in the country to take care of the demand for higher speed and wider bandwidth to handle seamless services like video, voice, data and graphics over the Internet.

It is also planning to broaden the bandwidth of connectivity to 155 Mbps from the present 64 kbps. This will enable it to run video clips on the Net.

According to sources, VSNL has decided to set up the subsidiary mainly to have transparency in its Internet business.

The idea is to have a traff-jams free multi-media capable service in future with valued added services like electronic commerce, EDI, and whatever new technology are there, VSNL said.

VSNL has applied for securing the platform and uplinking rights for DTH operations. While VSNL has applied for DTH platform for owning a transponder, the uplinking facility is expected to give a steady source of revenue for it over years.

Were not interested in the software segment, we want entry only in the platform and uplinking category, VSNL sources said.

A VSNL board meeting held recently in Delhi is said to have taken this decision.