Tag: VSNL

  • VSNL buys out 7 Star’s cable internet business

    VSNL buys out 7 Star’s cable internet business

    MUMBAI: Videsh Sanchar Nigam Ltd (VSNL) is on a shopping spree. The telecommunications giant has bought out the internet business of 7 Star, a major cable network in Mumbai.

    The deal gathers significance as it allows VSNL last mile access and offers an expansion route through cable operators. Telecom operators like Reliance Infocomm and Bharti have been eyeing the retail broadband market but been unable to see rapid growth.

    Though the acquisition price could not be confirmed, market speculation is that VSNL has paid around Rs 70-80 million. The cable TV operations are outside the deal. 7 Star runs cable TV operations in the western suburbs of Mumbai and offers cable internet through LAN (local area network) connections.

    “We have acquired the internet business of the 7 Star group—Sevenstar.com. We cannot disclose further details due to confidentiality reasons. We continuously evaluate options for growing our presence in the internet and broadband space,” confirms a VSNL spokesperson. 7 Star promoters were not willing to comment on the deal.

    The cable internet subscribers of 7 Star will be migrated to the Tata Indicom Broadband brand over a period of time. “7 Star will continue to assist us in managing the customers,” says the VSNL spokesperson.

    Analysts say VSNL was willing to pay a higher price because 7 Star was almost a monopoly internet player in the area where it was servicing cable TV operations. The stretch included the western belt of Andheri and Santa Cruz in Mumbai.

    VSNL has tied up with around 2000 cable operators across the country to overcome the problem of last mile connectivity. VSNL executive director N Srinath had earlier said allying with operators and sharing their network was one of the best options the company had.

    For strengthening its broadband presence in the Small and Medium Enterprises (SME) segment, VSNL on Monday announced it had entered into an agreement to buy out Direct Internet Ltd (DIL) and its wholly owned subsidiary Primus Telecommunications India Ltd (PTIL) for Rs 750 million. While DIL will focus entirely on the SME segment, the retail customers are likely to be rehomed in VSNL. The earlier acquisitions of VSNL included DishnetDSL for Rs 2.7 billion and Tata Power broadband for Rs 2.39 billion which gave it broadband subscribers in the retail as well as the SME segments.

    Is VSNL looking at tie ups with cable operators for IPTV service as well? “VSNL currently is providing broadband and content services, in conjunction with cable operators. The company will continue to look at offering various value added services that is of mutual benefit to VSNL and the cable operators,” says the spokesperson. Reliance Infocomm, Bharti and other telecom operators have plans to rollout IPTV but have been unable to resolve the last mile connectivity.

  • VSNL to buy Indian ISP for Rs 750 million

    VSNL to buy Indian ISP for Rs 750 million

    MUMBAI: Videsh Sanchar Nigam Ltd (VSNL) is strengthening its broadband presence in the Small and Medium Enterprises (SME) segment. The telecommunications giant has agreed to buy out Direct Internet Ltd (DIL) and its wholly owned subsidiary Primus Telecommunications India Ltd (PTIL) for Rs 750 million ($16.7 million).

    US-based Primus Telecommunications Group Inc will exit from India, selling its entire 85 per cent stake in DIL. VSNL is also buying out the remaining 15 per cent held by an Indian partner. The deal is expected to be completed in a few weeks, VSNL said in a statement.

    PTIL provides fixed broadband wireless internet services to SMEs in several Indian cities. The company has close to 1,000 SME and 10,000 retail customers. Out of a total revenue of around Rs 550 million in FY 2006, nearly 80 per cent came from the SME segment. Retail business accounted for 15 per cent while Voice-over-Internet Protocol (VoIP) contributed to around seven per cent of the company’s income.

    The retail customers are likely to be rehomed in VSNL while DIL will focus entirely on the SME segment. The company’s operations will continue to be run with the old management. “The huge infrastructre of VSNL will allow DIL an opportunity to expand in the SME segment. VSNL has massive bandwidth which will offer DIL’s operations greater efficiencies. In the past, we were buying bandwidth on a leased basis and this was consuming 60 per cent of our costs,” says DIL and PTIL founder-CEO Tilak Sarkar.

    This will be VSNL’s first SME-specific acquisition in the internet space. VSNL had earlier acquired DishnetDSL for Rs 2.7 billion and Tata Power broadband for Rs 2.39 billion which gave it broadband subscribers in the retail as well as the SME segments. DIL, on the other hand, has mostly SME subscribers.

    “The SME segment is a lowly penetrated but growing market. VSNL sees this as an opportunity to expand its presence in the broadband space,” says an analyst.

    VSNL has been aggressive in acquisitions over the last one year. While it bought Tyco International’s global under-sea fibre optic cable network unit in July 2005, recently it acquired telecoms network service firm Teleglobe International Holdings Ltd.

    Nasdaq-listed Primus Telecommunications, an integrated communications services provider offering international and domestic voice, VoIP, internet, wireless, data and hosting services to business and residential retail customers, had reported a net revenue of $1.19 billion in the 2005 fiscal.

  • Tata Sky targets 1 July for DTH launch

    Tata Sky targets 1 July for DTH launch

    MUMBAI: Rumours of delays may be rife in the market but Tata Sky – the 80:20 joint venture between the Tata Group and Star India – is targeting a 1 July commercial launch of its direct-to-home (DTH) service, informed industry sources aver.

    Tata Sky CEO Vikram Kaushik, while speaking to Indiantelevision.com, was however quite categorical that any talk of a date of launch was premature at this stage and therefore purely speculative. Kaushik would only confirm that his company was on target for a mid-year launch for its DTH service.

    Tata Sky will begin the “test run” of India’s third DTH service after Zee Group’s DishTV and Prasar Bharati’s DD direct from 15 May, the sources say. It has marked out a 45-day window period till 30 June during which time all technical and channel and programme related issues will have been ironed out.

    According to the sources, the preparatory work for the launch has been ratcheted up several gears in the last three weeks after the company collected from the information and broadcasting ministry the final licence clearing the way for the $500-million DTH service to take off.

    It was in December last that the telecommunication ministry gave its green signal for the vexed matter of setting up an uplinking base in Delhi by Videsh Sanchar Nigam Ltd, an issue that was under government scanner on technical grounds of land use by VSNL of its Chattarpur facility. The telecom ministry nod was seen as crucial for obtaining the final licence from the I&B ministry.

    Tata Sky has three operational centres in the country. Its technical set-up is headquartered in the capital, its complete back-up systems, including call centre operations, is out of Bangalore while its commercial activities are managed from Mumbai.

    One big priority of course is getting all popular channels onto its platform, a matter that rival DishTV has still to resolve with the Star network and the Sony-Discovery One Alliance. Here, like in the case of the Subhash Chandra-promoted DTH service, ESPN Star Sports has already worked out a carriage deal with Tata Sky.

    Queried about this, Kaushik would only say, “We are in ongoing discussions with all major broadcasters. More than this I cannot comment at this stage.”

    Speaking of channels, a key function of all addressable systems is the electronic programme guide (EPG). Tata Sky has exchanged letters with all broadcasters on use of logos and such in regards to how the programming highlights in its EPG will be displayed. The operator has reportedly requested all channels to provide these details ahead of the 15 May week.

    Another aspect that Tata Sky has to confront is of how to get around the last mile roadblock. One strategy that it is going with is to introduce pre-paid cards, which Kaushik believes would make subscription payment easier for the consumer. This differs from the DishTV strategy, which offers new customers its services for Rs 3,990 that includes one year’s subscription. After a year, DishTV subscribers pay a monthly subscription fee.

    Secondly, Tata Sky plans to take the responsibility of directly installing the hardware in every subscriber’s home and servicing it whenever needed. This again differs from DishTV which has a distribution network of about 5,000 dealers / distributors across the country.

    On the hardware side, Tata Sky, like DishTV has done, will be offering its boxes through consumer durable outlets.

    As regards subscriber acquisition, Tata Sky is following a two-pronged strategy of targeting individual consumers as well as institutions, for which there is a separate head of institutional sales.

    Industrial townships, hospitals, hotels, etc. are where the operator is directly negotiating to set up a central dish antenna through which it can connect individual installations.

    Where it has come into direct confrontation with last mile operators has been when it approached housing societies in various cities with the institutional model to offer its services.

    In fact, one of the reasons for a majority of cable networks in Kolkata blacking out the Star group of channels has been this issue. The protest against carriage of the Star channels in Kolkata is being led by the Forum of Cable Operators and Cable Operators Sanjukta, two association bodies of the last mile operators in the city. “Star was asking for a hike, which we couldn’t have passed on to the consumers. Besides, Tata Sky, where Star is a partner, is wanting to grab subscribers by offering housing societies free cabling from a single central antenna,” Cable Operators Sanjukta spokesperson Papi Banerjee told Indiantelevision.com recently.

    Be that as it may, Tata Sky has set itself some ambitious goals. The major one reportedly being to acquire around one million subscriptions by this year.

    Tata Sky CEO Vikram Kaushik, while speaking to Indiantelevision.com, was however quite categorical that any talk of a date of launch was premature at this stage and therefore purely speculative. Kaushik would only confirm that his company was on target for a mid-year launch for its DTH service.

    Tata Sky will begin the “test run” of India’s third DTH service after Zee Group’s DishTV and Prasar Bharati’s DD direct from 15 May, the sources say. It has marked out a 45-day window period till 30 June during which time all technical and channel and programme related issues will have been ironed out.

    According to the sources, the preparatory work for the launch has been ratcheted up several gears in the last three weeks after the company collected from the information and broadcasting ministry the final licence clearing the way for the $500-million DTH service to take off.

    It was in December last that the telecommunication ministry gave its green signal for the vexed matter of setting up an uplinking base in Delhi by Videsh Sanchar Nigam Ltd, an issue that was under government scanner on technical grounds of land use by VSNL of its Chattarpur facility. The telecom ministry nod was seen as crucial for obtaining the final licence from the I&B ministry.

    Tata Sky has three operational centres in the country. Its technical set-up is headquartered in the capital, its complete back-up systems, including call centre operations, is out of Bangalore while its commercial activities are managed from Mumbai.

    One big priority of course is getting all popular channels onto its platform, a matter that rival DishTV has still to resolve with the Star network and the Sony-Discovery One Alliance. Here, like in the case of the Subhash Chandra-promoted DTH service, ESPN Star Sports has already worked out a carriage deal with Tata Sky.

    Queried about this, Kaushik would only say, “We are in ongoing discussions with all major broadcasters. More than this I cannot comment at this stage.”

    Speaking of channels, a key function of all addressable systems is the electronic programme guide (EPG). Tata Sky has exchanged letters with all broadcasters on use of logos and such in regards to how the programming highlights in its EPG will be displayed. The operator has reportedly requested all channels to provide these details ahead of the 15 May week.

    Another aspect that Tata Sky has to confront is of how to get around the last mile roadblock. One strategy that it is going with is to introduce pre-paid cards, which Kaushik believes would make subscription payment easier for the consumer. This differs from the DishTV strategy, which offers new customers its services for Rs 3,990 that includes one year’s subscription. After a year, DishTV subscribers pay a monthly subscription fee.

    Secondly, Tata Sky plans to take the responsibility of directly installing the hardware in every subscriber’s home and servicing it whenever needed. This again differs from DishTV which has a distribution network of about 5,000 dealers / distributors across the country.

    On the hardware side, Tata Sky, like DishTV has done, will be offering its boxes through consumer durable outlets.

    As regards subscriber acquisition, Tata Sky is following a two-pronged strategy of targeting individual consumers as well as institutions, for which there is a separate head of institutional sales.

    Industrial townships, hospitals, hotels, etc. are where the operator is directly negotiating to set up a central dish antenna through which it can connect individual installations.

    Where it has come into direct confrontation with last mile operators has been when it approached housing societies in various cities with the institutional model to offer its services.

    In fact, one of the reasons for a majority of cable networks in Kolkata blacking out the Star group of channels has been this issue. The protest against carriage of the Star channels in Kolkata is being led by the Forum of Cable Operators and Cable Operators Sanjukta, two association bodies of the last mile operators in the city. “Star was asking for a hike, which we couldn’t have passed on to the consumers. Besides, Tata Sky, where Star is a partner, is wanting to grab subscribers by offering housing societies free cabling from a single central antenna,” Cable Operators Sanjukta spokesperson Papi Banerjee told Indiantelevision.com recently.

    Be that as it may, Tata Sky has set itself some ambitious goals. The major one reportedly being to acquire around one million subscriptions by this year.

  • Murdoch dips into fibre-optic network: Alliances on the card

    Murdoch dips into fibre-optic network: Alliances on the card

    Murdoch mania still is hot in town as speculation about what he really intends to do in the Indian market rising to a fever pitch. He had a rash of meetings on 14 March with top brass industrialists and other prominent political personalities.

    Maharashtra Chief Minister Vilasrao Deshmukh and he discussed the possibilities of investment in the Infotech and telecom area. Ministerial sources disclosed his intentions to set up a state-of-the-art fibre optic telecom carrier network in Mumbai. A possible partner for this project is InCable which has been laying a fibre optic network in the city. Star TV does not have any investments in cable TV distribution, having sold out its holdings in Siticable to Zee TV. The fibre optic project will l cater to Murdoch’s Infotech dreams in India and facilitate e-commerce and e-education and create tremendous job opportunities, ministerial sources said.

    Murdoch also met up with MTNL and VSNL executives at the Ministerial meeting. MTNL, the state telecom provider MTNL which has a strong optic-fibre backbone and Hughes Ispat which also is rolling out its network over the city.

    The Chief Minister, wanting investments in the state, also assured Murdoch that News Corp’s proposal to set up an entertainment programming studio will be cleared within a month’s time. News Corp plans to invest around $100 million in this area alone. The commercial capital of India seems to have impressed Murdoch as he identified the tremendous potential in this city.

    It is now the time of Delhi for big announcements where Murdoch will hold high-profile meetings.