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INTERNET SERVICES OPEN UP, CABLE OPERATOR AMONGST
FIRST LICENCEES
Keeping its commitment, the Indian
government threw open Internet services to the private
sector on 7 November. Three licences were issued,
one of them to a multisystem operator (MSO), Ortel.
(Domestic telecom carrier MTNL and Surewin Consultants
are the other two firms, which have got a licence.
Some 47 applications are awaiting governmental clearance).
Ortel is located in the east Indian state of Orissa
and has around 25,000 subscribers. The company has
cable TV operations in the cities of Bhubaneshwar
and Cuttack. Hitherto, commercial Internet services
were the monopoly of the state-owned Videsh Sanchar
Nigam Ltd and the department of telcom.
The new policy allots licences to applicants free
for five years, Rs 1 per year from then on for the
next 10 years, and allows foreigners to invest in
up to 49% of their equity. Three kinds of Internet
service providers (ISPs) will be licensed, the policy
says. The three categories are: A, B, C, referring
to their coverage on a nationwide, state-wide, and
district-wide basis, and their capability to bring
in bank guarantees of Rs 20 million, Rs 2 million
and Rs 300,000 respectively. There is no limit on
the number of licences to be awarded for each category.
Private ISPs can lease transmission
lines from existing utilities, or set up their own
transmission networks, after getting permission from
the government. They can also use the infrastructure
set up by cable operators who reach out to 20.3 million
subscribers all over India.
MSOs, however, seem to be interested
in becoming ISPs themselves. Both Siticable and InCableNet,
the two major Indian MSOs, with about 4.5 million
subscribers between them nationally, have applied
for licences. Computer networking firm Microland announced
recently that talks with the two were at an advanced
stage. It is also believed to have initiated a dialogue
with Ortel. Microland has a tieup with US firm Nortel
Networks to market its Internet via cable TV solutions
to companies in India.
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