CIOL: There are still problems facing the Internet telephony sector. It is yet to make it big in India despite a significant increase in the Internet subscriber base. Triggered by issues including access to last mile connectivity and unrestricted telephony access, Internet Service Providers (ISPs) are unable to tap the market potential existing in the country.
Revenues from the Internet and Internet Telephony services for the April-May-June quarter for FY 2005-06 stood at Rs 550 crore. The industry is expecting revenues to the tune of around Rs 1,300 crore for the current fiscal and has the potential to grow three times more than the present. Still, all is not well for the industry players. If ISPs lay their own cable to offer the service, it would be expensive, which would result in bad quality of service.
The Internet Service Providers Association of India (ISPAI) has sought unrestricted telephony access that would allow users to make calls from both mobile and landline numbers. Currently, users have limited choice in India. This is because only PC-to-PC calls are allowed in the country. When IP telephony debuted in the Indian Internet market in 2002 there was an estimated 120-odd ISPs offering this service. The Department of Telecommunications (DoT) projected the IP telephony market to be Rs 500 crore in 2002. However there are only 50-odd ISPs now, holding operating licenses. Out of these 50 ISPs, only five to six are actively offering the service.
ISPAI estimates said that 36 million minutes and 43 million minutes were used in the JAS and OND quarters respectively in fiscal 2004-05.
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