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Monday, February 1, 1999

Cheap, but MTNL may still find the going tricky 

Anil Wanwari  
Jan 31 : MTNL has decided to offer internet access at a 15 per cent discount as compared to what VSNL and Satyam charge. But then it has put a limit of 5,000 subscribers to start with in Mumbai and Delhi, going up to 20,000 for the two cities by April. Its target is 100,000 subscribers and it hopes to break even on a total investment of Rs 20 crore by end this year.

Will the service take off? The corporate leased line and ISDN dial-up services, which are being offered at a lower rate than VSNL, are likely to. However, it is on the retail end where it may find the going tricky. Because pricing is key in internet access for individuals. Especially in a nascent market like India where awareness of the world wide web is taking time to percolate down the strata as the penetration of computers is nothing to write home about.

A single new subscriber will need to spend a minimum of Rs 30,000 to buy an unbranded computer. This apart he has to also pay for training and phone line usage charges. The cost of MTNL'saccess -- though lower than VSNL's backbreaking charges -- therefore seems too high.

In America, prices range from nothing to $20 per month for unlimited access. Cable internet service providers charge between $30 and $40. Also, local calls are free in several states. The key word is "unlimited access" at those prices.

Thankfully, MTNL chairman and managing director S Rajagopalan has said these rates are not final and they are likely to fall further. In fact the buzz was that MTNL was planning a free internet access service. (It has milked its telecom infrastructure in terms of revenues so much that just the use of the telephone lines for internet access would not only cover the cost of setting up its internet infrastructure, but also yield profits.) However, this was scaled down further to 30 per cent and later to 15 per cent courtesy government and VSNL pressure.

MTNL will mint money if it meets its targets by end this year. Apparently, VSNL is estimated to be earning Rs 100 crore from its internetservice annually. It probably is one of the more profitable ISPs internationally, as it offers a barebones, vanilla internet service.

Hopefully, VSNL will take a cutback on the mega profits it is making and dole some of that back to subscribers by increasing the number of hours of access their existing subscription offers them. That hopefully, will have a ripple effect on MTNL which too will be forced to cutback. The private ISPs (there are about three of them offering a service already) will, however, not be able to afford too drastic a cut unless international gateway charges fall further. Which too may happen should cheaper private gateways come up.Competition can work wonders

Another venue that wannabe ISPs and even marketers and ad agencies should consider visiting is Internet World Asia @ Singapore `99 which is being held between 3-5 March 1999 at the Singapore International & Convention Centre. The first of its kind in Asia, Internet World Asia is being organised by Penton Media and ReedExhibition Companies. The exhibition and conference is being touted as "the opportunity to view the latest in Internet applications, ISPs, web content development and electronic commerce.

Additionally, The Asia Pacific Regional Internet Conference on Operational Technologies (APRICOT) is being held from March 1-5, 1999 at the same venue. Other groups such as the Asia Pacific Networking Group, Asia Pacific Top Level Domain Forum, Asia Pacific Networking Information Centre and the Asia Pacific Internet Association are also slated to have their annual general meetings around the same time as Internet World Asia. Those wanting further information can log into http://www.iw.com.sg

Domain squatters

Domain names are a major issue in the Internet World. Several individuals and companies - called domain squatters -- have made it a business to register a clutch of popular names. They then ask the firms whose names they have registered to cough up big sums of money to get access to their domain names.That's one part of the problem. The other one is renewing the domain name registration with registrar InterNic or other registrars internationally.

Consider. In the US, Paramount Pictures simply forgot to renew the registration for the domain www.inandout.com, a movie site based around the movie In and Out, featuring Kevin Kline. Along came a domain name broker, who did that job but he placed X-rated banners and adult content on the site. All fine, so far. But Paramount had mentioned the inandout.com URL in a movie database on the web and in adverts. Hence, when film buffs got into the site, some were titillated, others were horrified. And the entire episode created a furore.

This is where www.domainmart.com comes in. It says that it will look after the renewal of domain names with the various registrars worldwide at a fee. It will issue a renewal reminder to those who sign on with it for its service. Or it will pay the renewal fee on behalf of its clients. Should Indian companies want to know more aboutits services, send an email to Portfolio-management@domainmart.com.

The writer can be reached at wanvari@giasbm01.vsnl.net.in or television@hotmail.com

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.


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