Net Telephony, Big Letdown

Adding to Internet telephony service providers cup of woes, international long distance service provider Videsh Sanchar Nigam Ltd (VSNL) has more than halved its international long distance call rates. ‘Net telephony is still in a nascent stage. Things are just evolving. It’s a long way ahead. Unfortunately, the internal bickerings among ISPs have already started showing with blocking of sites by big players like Bharat Sanchar Nigam Ltd (BSNL), VSNL and to an extent MTNL,’ says Sunil Vishwanathan, chief operating officer of Caltiger, a Kolkata-based internet telephony service provider.

‘Even when I am talking over the internet, I have to pay for the internet connection and basic telephone charges. Moreover, the quality of voice through internet is a prime suspect in many cases. The high basic telephone charges for internet access is one of the reasons why internet and its associated services like internet telephony, shopping through internet, etc, have not taken off in a big way in India,’ says G. Venkatramani, a bank employee, who stopped using internet telephony recently.

Basic requirements for an ISP to provide internet telephony services are 5 to 9 kbps bandwidth unlike 2.5 to 4 kbps bandwidth required for internet access and equipment for quality back-end like gatekeepers as well as routers to detect voice packets.

At present an internet telephone service provider transact somewhere around 50,000 to 55,000 minutes a day on their network. About 90 per cent of the calls on internet are made to destinations like United States, UK, China and Canada, while Middle-East remains the costliest call on the net.

But interestingly, even today US-based websites like Phonefree, Buddyphone offer free IP telephony. All one has to do is download their software into the system, register an user ID and start speaking. Even though foreign service providers have tie-ups with Indian internet service providers, one can directly buy bandwidth from the service provider abroad and pay them through their credit cards. ‘This normally does not happen because, people feel unsecure when they use their credit card on the Net for such transactions for fear of getting their pin number cracked and misused,’ says Vishwanathan.

The competition among the internet telephony providers is getting hotter by the day and they are leaving no stones unturned to attract the customers. HCL InfiNet, the internet subsidiary of HCL Infosystems, has recently announced a reduction of 16 per cent on its Valufon card. With this reduction a call to US will now cost just Rs 4.99 per minute.

‘Using a Valufon is a different experience altogether. The customer call goes to HCL InfiNet’s managed service VoiceNet, which provides customer an assured bandwidth for placing a call,’ says Saurav Adhikari, president of HCL InfiNet.

The rate war between internet telephony service providers was led by international telecom services provider VSNL—which is also into Internet telephony—by slashing its tariff by up to 40 per cent in July. VSNL’s tariff rates for outgoing traffic to countries in the US was reduced by over 40 per cent while those for countries in Europe, Africa and the Gulf were cut by around 25 per cent.

The tariff rates for SAARC countries have been reduced by 5 per cent. VSNL can carry customer calls with quality and reliability to more than 230 countries around the world through its 80 plus relationships with international carriers.

‘So nobody is in a hurry to make international calls through internet,’ summed up one VSNL official.