The Hindu Business Line : VSNL to roll out WiMAX in 12 cities next year

Chennai, Jan. 31 After the successful launch of its WiMAX services in Bangalore, VSNL intends to roll out the product in 11 more cities by March 2009. Chennai, Delhi and Hyderabad will be the first three among them, Mr Srinivasa Addepalli, Senior Vice President-Corporate Strategy, said on Thursday.

WiMAX, a wireless broadband technology, will bring internet to homes. With WiMAX, you get a little box fastened to your window (because the spectrum allocated is not enough for the box to be next to the computer). The box is connected to the PC either by wire or by Wi-Fi and you start browsing the Internet. VSNL promises speeds of 1 mbps, good enough to download pictures and video, but still not enough to watch a cricket match on the PC.

Huge demand

Speaking to journalists here, Mr Addepalli said that VSNL, which proposes to spend Rs 2,000 crore on WiMAX, sees a customer potential of close to 30 million for these services. In Bangalore, the company did not even have to market. It had a huge list of customers who had asked for broadband but had not got it — it was a simple task to sell WiMAX-based broadband to these customers.

The offering is slightly more expensive, because, “wireless is more reliable”. But Mr Addepalli is not worried about competition because of the huge demand for broadband, which he feels the current broadband suppliers are not able to meet. He notes that there are 10 million people with personal computers, but only 3 million with broadband. “There is no reason to believe those with PCs do not want broadband,” Mr Addepalli said, adding that with devices such as smart phones coming in, demand for broadband would only go up.

Data centres

VSNL is also expanding its other services — remote management of telecom networks, data centres to host servers and optic-fibre cable infrastructure across continents. It is putting up data centres at Mumbai, Chennai and Hyderabad. Mr Addepalli pointed out that companies like Google and Yahoo are giving their customers huge space, where pictures and videos are stored. “All these have to be hosted somewhere,” he observed.

The company is further investing $600 million (Rs 2,200 crore) on adding to its existing submarine cable network.

It also manages network for global telecom companies. This ‘managed services’ business was launched just a year ago is offered through a subsidiary, VSNL Global Services Ltd. So far, it has won four contracts, including one from the US-based Global Capacity.

Mr V.S. Shridhar, Chief Operating Officer, VSNL Global Services Ltd, said that about 650 engineers, sitting in Chennai and Pune, would manage networks for clients. Since this fledgling business is growing, VSNL Global would hire 2,000 more people by March 2009, Mr Shridhar said.

Mr Addepalli said that VSNL wanted to enter China and was studying the market for opportunities.

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