Saturday, June 19

ISP's concentrate on VAS

Earlier other than PSTN Dial-up & ISDN there were very few value addition with ISP like Leased Line, Hosting, Co-locating server, etc. But now with VSNL's demonopolization and increase in service spectrum and increase in the knowledge of corporate sector, ISPs are looking forward to gamut of Value Added Services like VOIP, DSL, Bandiwidth on Deman, VPN, Managed Services, Vide & Web Conferencing, Net Telephony, and lots of other mix-n-match of services. This Express Computer article discusses the slag faced by ISP idustry in general due to the dial-up dependancy of the customer, there is need for new technologies and new exitement. For example, I don't have boradband connection at home and may not in the near future also because in our area there are too many cybercafes and it should be profitable for my cable provider / internet provide to provide the connection in my area and/or building complex, but thanks to Reliance India Mobile I can now connect anywhere through my laptop or desktop.
Express Computer Online :The growth of the Internet subscriber base in India has slowed down, it was less than five percent during Q3 and Q4 of 2003. According to the Internet Service Providers Asso-ciation of India (ISPAI), this is because close to 95 percent of Indian customers are still on dial-up which is unreliable in terms of speed and quality of service. Worse, a dial-up user gets hit with hefty phone bills on top of what he pays the ISP.

ISPAI points out that ISPs are focusing on metros and select B-class cities. This leaves small towns where customers cannot afford the high cost of buying a PC, an Internet connection and paying the telephone charges for ‘net access. These users prefer to go the nearest cybercafe; hence the scope for increasing the dial-up subscriber base is very low. ISPs are therefore forced to look at VAS to make up for the loss they are incurring from pure dial-up services. Says Amitabh Singhal, president, ISPAI, “Out of the 4.1 million Internet subscribers in India, a majority reside in cities. That number can go up to 40 million if we offer value-added services such as broadband.”

ISPAI believes that Indian ISPs have plumped for the VAS route in order to be profitable with a low subscriber base. One obvious route is to sell services that increase bandwidth consumption and thereby the ISP’s revenues. Notes Singhal, “In the last couple of years, many Indian ISPs have shuttered their establishments due to the slow growth of their subscriber base. ISPs will have to offer broadband and value-added services to remain in business.”