India’s international bandwidth conundrum

Posted on December 18, 2009  /  0 Comments

Multiple submarine cables with multiple landing stations, owned by different entities, don’t offer competitive wholesale international bandwidth in India. Today a chunk of 10-gigabytes bandwidth varies between $5 million and $9 million in India while it’s being sold from $1.5 million to $1.7 million in other Asian markets.

It’s a huge challenge for the world’s fastest growing telecoms market where broadband penetration remains a national embarrassment. India is plugged with nine submarine cables: Tata Communications’ five, Bharti’s two, Reliance Communications’ one and another network belonging to a Bharti-Reliance consortium. Each of these conglomerates also own and operate respective web of domestic backhaul.

Local and foreign long distance carriers, having no such ownership, buy wholesale bandwidth from these undersea cable owners and retail it to the consumers. But the cable owners seem to have been taking the underdogs for a pricey ride. Recently the latter has urged to regulate the wholesale bandwidth prices. Can regulatory intervention guarantee competitive bandwidth prices in India?

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