VSNL could lose 6 per cent of outgoing traffic

BANGALORE, August 26 : The Videsh Sanchar Nigam Limited

(VSNL) could lose about 3.8 crore minutes of outgoing international

traffic by the year 2001 to Internet applications, according to London-based Philips Tarifica Ltd., an

international telecommunications consultancy company.

Tarifica conducted a case study titled "impact of

changing international telecom environment on India", which said that

this would work out to six per cent of its outgoing traffic. It said

carriers in Europe are able to compensate the revenue loss in

international call markets due to Internet by a revenue gain in local

calls market generated by web browsing, while VSNL does not have presence

in the local calls market and has to depend on subscription charges.

The overall traffic will increase as lower settlement

rates are passed onto customers in the developed world. However, tariffs

are expected to remain higher in India, resulting in a greater imbalance

of traffic. Imbalance on the US-India route will further rise due to call

back effect. The scenario could produce an estimated combined

international traffic volume of about 350 crore minutes by the year 2002.

Tarifica said carriers in developed countries are

expected to pass on the benefits of reduction in settlement rates to their

customers more than the carriers in developing countries. As such the

incoming traffic will continue to outweigh the outgoing. Incoming traffic

from the US could reach as high as 150 crore minutes by the year 2002, it

said. Refile and call back could reach well over 50 crore minutes by year

2002, said Tarifica.

Once foreign carriers enter the Indian market , they may

put their own facilities to terminate the incoming traffic. Then, only the

DoT’s domestic network will fetch some revenue and VSNL’s

infrastructure could be altogether bypassed then. Tarifica said, VSNL as

an independent entity has been assigned to deal with international traffic

that is expected to be the highest growth area in terms of volume in

coming years in the telecom services market. Any move that risks its

independence will result in VSNL losing the flexibility in responding to

global telecom trends.