[76462] in North American Network Operators' Group
Lots of bandwidth coming into India by next year
daemon@ATHENA.MIT.EDU (Suresh Ramasubramanian)
Fri Dec 10 21:22:29 2004
Date: Sat, 11 Dec 2004 07:54:10 +0530
From: Suresh Ramasubramanian <suresh@outblaze.com>
To: 'nanog list' <nanog@merit.edu>
Errors-To: owner-nanog-outgoing@merit.edu
Article about how lots of new undersea cables - SEA-ME-WE 4 (VSNL and=20
Bharti), Falcon (which I think is FLAG as Reliance is bringing it in),=20
and at least one new VSNL link to Singapore - are going to lead to about=20
541 gigs more bandwidth coming into India, so that costs will be lowered
What I can see is that there have been other factors so far for Internet=20
costs to be as high as they are in India.
1. VSNL, back when it was the incumbent ISP, hanging on to most of the=20
available bandwidth in FLAG and refusing to release more than 10% of it,=20
leaving the rest of it dark.
2. Lack of peering so far (and inefficient peering now at nixi.org)=20
means a lot of local traffic still gets routed through international link=
s.
3. More providers with nationwide fiber and right of way - mostly=20
government owned public utility companies (railtel from Indian Railways,=20
then there's the Gas Authority of India ...)
4. Competition seems to be making most ISPs cut their prices and up
their service offerings, especially in Broadband. Even the government=20
owned telco BSNL, which has an edge in that the regulators / ministry of=20
IT feel it is their "duty" to protect it, seems to be reacting to all=20
the competition by rolling out new and better priced products.
I am sorry the article isn't more technical .. it was printed in The=20
Economic Times, one of several newspapers around the world that's=20
printed on salmon pink paper.
srs
http://economictimes.indiatimes.com/articleshow/947564.cms
Net surfing costs to crash by almost 50%
TIMES NEWS NETWORK[ MONDAY, DECEMBER 06, 2004 01:26:22 AM]
MUMBAI: There=E2=80=99s a price war on its way. In =E2=80=9905, India=E2=80=
=99s undersea cable=20
capacity =E2=80=94 which provides the =E2=80=98roadway=E2=80=99 for data =
and voice transfer=20
across the world =E2=80=94 is due to rise by 17 times over =E2=80=9901 le=
vels.=20
Naturally, this means that costs will crash =E2=80=94 industry estimates =
are=20
that connectivity costs will nearly halve.
So surf the net faster, check your mail on your mobile, and don=E2=80=99t=
worry=20
about getting those huge databases across to California. All this at=20
half the price. So forget about India losing its low-cost edge in the=20
BPO space. There=E2=80=99s good news coming your way, in the form of a 54=
1 Gbps=20
chunk.
This fall in prices will bring India=E2=80=99s connectivity costs at par =
with=20
those across Asia. The decline in prices is likely to help BPOs the=20
most. For instance, currently, the total monthly cost of a DS3 to US is=20
$126,192, significantly higher than Malaysia=E2=80=99s $20,922, Philippin=
es=E2=80=99=20
$27,185, Singapore=E2=80=99s $14,435 and $13,956 in Korea.
A DS3 is a 45 Mbps (mega bits per second) capacity connection. Most BPOs=20
have a minimum of 1 or 2 Mbps capacity, but the larger ones have several=20
DS3s or even larger capacities. BPOs are estimated to utilise about 30%=20
of international capacity, and are second only to internet service=20
providers (ISPs) in international capacity consumption.
Currently, in Asia, Indonesia, India and Thailand, in that order, are=20
the most expensive countries. =E2=80=9CWithin Asia, India is five times m=
ore=20
expensive than the Asian hubs of Singapore, Hong Kong and Japan,=E2=80=9D=
said=20
Puneeth Punja, principal analyst with research firm, Gartner. In other=20
words, the cost of connectivity between Singapore-Hong Kong is one-fifth=20
that of connectivity between Singapore-India.
One of the reasons for the higher prices in the country is that, from=20
=E2=80=9901 to =E2=80=9904, the prices on a cumulative basis fell by just=
40% in India,=20
while those in the rest of Asia fell by 70-80%. Increasing competition=20
and bigger cable capacities are likely to result in a sharp fall of over=20
50% in India in =E2=80=9905. The rest of Asia is likely to see a lower fa=
ll of=20
an average 20%, thus leading to price parity across India and the other=20
Asian countries by =E2=80=9905.
=E2=80=9CThe available capacity has grown from 31 Gbps in =E2=80=9901 to =
541 Gbps by the=20
first quarter of =E2=80=9905, a 17-fold increase. So, the pricing is expe=
cted to=20
drop significantly,=E2=80=9D said Tony Nash, vice companies president, ma=
rketing=20
and communications of the Singapore-based Orient Networks, a=20
telecommunications network service provider. =E2=80=9CConnectivity costs=20
comprise 10-25% of a BPO=E2=80=99s operating costs,=E2=80=9D said Mr Nash=
.
The new cables touching India=E2=80=99s shores includes South East Asia-M=
iddle=20
East-Western Europe 4 (SEA-ME-WE 4) where VSNL and Bharti are part of=20
the 12-member consortium, the Chennai-Changi cable of VSNL and the=20
Falcon cable of Reliance Infocomm.
The Telecom Regulatory Authority of India (Trai), in its consultation=20
paper on revision of tariff of domestic leased circuits released in June=20
this year, had proposed an over 63-75% reduction in the tariffs for=20
capacities of 2 Mbps and 64 Kbps for beyond 500 km. =E2=80=9CLeased lines=
are=20
the dominant product in both domestic and international data services,=20
comprising close to 80% of the total market,=E2=80=9D said Mr Punja.
