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Thomas K. Thomas

Migration from dial-up affects ISPs

New Delhi , June 30

Internet usage has slumped by 41 per cent over the last year, according to the data compiled by the Telecom Regulatory Authroity of India (TRAI).

Internet usage has gone down from an average of 305 minutes per subscriber per month in March 2005 to 175 minutes per user per month in March 2006.

While the TRAI report does not give any reason for the slump, industry experts say that the Internet segment has not seen price cuts for a long time, with operators continuing to charge up to Rs 30 an hour. Market watchers also pointed to lack of any policy directions from the Government for the sector, which could have resulted in many ISPs closing shop, thus impacting usage.

Though close to 14 lakh new subscribers were added during the period, four companies - BSNL, MTNL, Sify, and VSNL - account for a large part of the subscriber base.

While there are 153 ISP licence holders, more than 75 per cent of the Internet user base remains with these four companies.

Analysts said that in the case of BSNL and MTNL, if a telephone user logs on to the Net even once, he is considered an Internet user for life; this can pull down the average minutes of usage.

Officials of the Internet Service Providers Association of India said that the slump in the usage could be due to many dial-up users migrating to broadband connections.

"Most of the broadband users are erstwhile dial-up Internet users. So, the usage is bound to slump since broadband usage cannot always be measured in minutes per month," said an ISP operator.

The number of broadband subscribers has crossed 1.6 million now, from a few thousand last year.

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