The new company, Satyam-RPG.com Ltd, will provide the service to householdsas well as business customers who are hooked to RPG Netcom's cable TVservice. RPG Netcom supplies satellite TV feeds to over 70 per cent of theoperators in Calcutta.

The signing of the memorandum of understanding was announced by RPGEnterprises vice-chairman Sanjeev Goenka and Satyam Infoway managingdirector R Ramaraj.

The joint venture, which will have a paid-up capital of Rs 20 crore, willinvest in high-quality infrastructure, including necessary improvements inthe head-end equipment and related plant to enable a significant upgrade in"last mile" connectivity.

Apart from providing broadband internet access through cable TVinfrastructure, the joint venture will create a Bengal interest portal toprovide local content and commerce.

Sanjeev Goenka said the portal will provide high-quality information,educational content and ability to enable local e-commerce at bothbusiness-to-business (B2B) and business-to-consumer (B2C) levels.

Ramaraj said this will be the first successful venture of its kind in Indiaand also the cheapest. The new company will start providing internetservices from the first quarter of the next fiscal.

He said although pilot projects have been tried in Bangalore and Mumbai,there was a lukewarm response as the cost was too high and good qualitycable infrastructure was not available.

"Here, we are providing the best available hardware and cable network in thecountry, while Satyam will be providing best available software," saidSumantra Banerjee, managing director of RPG Netcom, which a part of the Rs6,500-crore RPG Enterprises.

RPG Netcom began commercial operations as a multi-service operator inCalcutta and neighbouring areas in January 1997. It has become the dominantplayer in the local cable TV market and has its own news, movie and cableradio channels.

RPG Netcom has installed India's first BARCO head-end and operates on ahybrid fibre optic and coaxial cable trunk covering 800sqkm. It has put inplace 34 optic nodes at strategic locations and offers a 57 channel package.The network is expanding at a rapid pace with proliferation of optical nodesfor improved service, Banerjee said.

Satyam's Ramaraj said the pricing has not yet been worked out, but theservice will be cheaper than the one provided via the government-ownedtelephone network. After next year's budget, the price will fall, as theindustry expects an excise cut on related equipment.

He said the joint venture company expects to capture 10 per cent of RPGNetcom's customers within one year of operations.

Ramaraj said a host of local factors will make the cable internet a successin Calcutta. For one, cable TV homes outstrip those with personal computers.Second, there is no need to buy a personal computer -- the TV will do, witha set-up box. Second, with speeds of 2-5mbps, cable internet will be faster,especially in areas where network is fibre optic. Lastly, no extra telephonecharge has to be paid.