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V. Rishi Kumar

Hyderabad , Jan.30

THE VSAT (very small aperture terminal) industry that facilitates deployment of telephones in remote parts and rural areas, estimated at about $100 million (about Rs 450 crores), has grown by about 20 per cent in 2004 and is poised to continue its growth given the current plans for rural telephony.

The Vice-President of Comsat Max, Mr Joyjit Chatterji, told Business Line that the $100 million VSAT industry witnessed a growth of 20 per cent in terms of revenue.

However, in terms of installations, the growth rate is estimated to be much higher, likely in the range of 40 per cent. And this trend is likely to continue given the plans to expand rural telephony reach across the country.

Mr Chatterji said "we estimate the growth in installations to continue to range 40-50 per cent in calendar year 2005. The market size in terms of revenue should grow by about 25 per cent. The higher growth in installations and revenue would be because of some favourable policy announcements."

"With the Government allowing VSAT operators with an ISP (Internet service provider) licence to offer bandwidth to individuals, the market will witness growth in the SME (small and medium enterprises) and SOHO (small office, home office) user segments as well," he said.

With regard to the potential impact of the new policy on the VSAT industry, due to the Telecom Regulatory Authority of India's licensing policy, Mr Chatterji said "it is still early days for the policy recommendation. The actual impact can be ascertained only after the policy is accepted, be it in part or in totality and the notifications issued. We are in the process of studying the implications of the recommendations."

Mr Chatterji said with regard to penetration in rural areas, "BSNL is expected to roll out a large network in rural areas for telephony. This will be the largest VSAT network in India. While, undoubtedly, VSATs provide the most optimum way for communicating in rural areas, and in some cases the only method, data networks are dependent on the application and local specific needs."

"While ITC's e-chaupal has seen about 3,000 VSATs getting rolled out, enhanced penetration will be dependent on need and actual applications. VSATs can only help in ensuring applications are delivered successfully," he explained.

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Thanks to thrust on rural telephony — VSAT sector set for faster growth in 2005

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