Telecom players eye VoIP market

NEW DELHI: Competitive calling rates have attracted big telecom players in the Internet telephony market to India.

With operators striving to grab a major pie of the Voice Over Internet Protocol (VoIP) market, each Internet telephony service providers (ITSP) has started reducing the call rates one after another.

The internet telephony market is expected to take off at a much faster pace. However, the VoIP service is much cheaper for international calls and the ITSPs are targeting this space.

The Internet telephony service in India had a humble beginning and the players were skeptical about the growth of the industry. But in the last five years, after the networking and telecommunication companies started focusing on the IP telephony, it has been maintaining a better pace. Now, IP phones are making serious inroads into business telephony over the world.

Irvine, California-based Maya Telecom, one of the companies in the Internet telephony business, has launched the international calling cards at a cheaper rate. Eyeing the home users for the calling cards, Mayatel has targeted the mid-size call centers for the selling.

“The mid-size call centers are selling our calling cards for the home user segment. This has yielded good results for us, bringing better revenues,” Sam Mohanty, country head said. He said that they are selling around 6 million minutes in India per month.

Even though there are only a handful of Internet telephony service providers, there is massive competition in this voice market. Mohanty said that there are only three major providers offering competition Internet telephony in India – Net4India, Mayatel and Worldfone.

However, metro telecom giant Mahanagar Telephone Nigam Limited last week plunged into the Internet telephony business to get a larger share of the pie.

There are also players like the Skype, Gtalk and Yahoo!, which are quite popular for making free international calls.

Price war

With more players entering in the market the monopoly of the trade is dying out, benefiting the consumers. Net4India launched the ‘One World’ plan offering calling rates at Re 1 to more than 40 countries worldwide.

According to Jasjit Sawhney, chief executive office, Net4India, it is a breakthrough in the VoIP (Voice over Internet Protocol) market. The company claims to have witnessed enthusiastic response from the customers.

To beat the competition, Mayatel, a division of Telmar Network Technology, has come up with rates lower than Re 1 to attract more customers.

Not to be left behind, the new player in the VoIP business, MTNL is taking the advantage of its broadband network to the homes and offering VoIP calling at Re 1 to US, UK, Canada, Australia and many other countries.

Death of PC to PC calling

The VoIP calls that one make from PC to PC seems to have finally come to an end. Jajah, another VoIP player has made its entry in to the Indian telephony market last month offering VoIP calls from mobile phone or landlines to any part of the world.

It is a subscription based offer, where the customer needs to register his mobile number and the phone number he wants to call. After a couple of seconds both the subscribers receive a call. According to Jajah officials ‘it is seamless’. They even claim that it reduced the cost of calls up to 95 per cent.

MTNL VoIP customers would be able to make International calls just like making calls from a normal telephone without the need of a PC. The service is provided through Analog Telephone Adaptor (ATA), which shall be connected to ADSL modem to make calls.

Real story

However, most of the operators have made inroads into the Internet telephony market in India. But the for domestic calls, the subscribers hugely rely on telecom service providers.

Above all, the low growth of broadband has also hit the growth of ITSP hard. According to experts, the future of the VoIP market would be decided by the penetration of broadband in the country.

Despite the government has declared 2007 as the ‘Year of Broadband’, the rate of penetration still remains low. The government has set a target of nine million broadband connections by year-end. The total broadband connections as of July have reached 2.47 million, according to latest figures released by Telecom Regulatory Authority of India.

It may be mentioned here that the industry has already missed the first target of three million broadband customers by 2005.

Now the hopes of the VoIP players are clinging on the number of broadband subscribers.

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