Telecom Goliath set to stride in

NEW DELHI: It’s the birth of a new giant in the Indian telecom infrastructure. RailTel, GailTel and Power Grid have come together to form a single national long distance (NLD) operator and will enter the commercial telecom space soon. This yet unnamed telecom Goliath (which will have an optic fibre cable capacity of 75,000 kms nationally in addition to thousands of kms of intra-city networks) will make hitherto big infrastructure players such as Bharti (36,000 kms) and Tatas (23,000 kms) seem relatively small in comparison.

Their entry into the NLD space is also expected to send STD rates in the country, which are already the lowest in the world, crashing further. “Despite a slew of new entrants in the NLD space recently, almost the entire STD traffic in the country is currently carried through the OFC networks of Bharti, Reliance, VSNL and BSNL. The consortium can offer nationwide connectivity at prices that are far cheaper than the current rates,” said an industry source.
In July this year, the department of telecom (DoT) awarded NLD licenses to Railtel, Gail and Power Grid. Their combined network size, including their intra-city networks, will be second only to BSNL in India. “We all have managed to get NLD licences for our telecom operation. Everything has been finalised. We may announce it soon,” RailTel MD KK Baypayee told ET.

The move to jointly offer NLD services comes exactly a year after the three PSUs had first come together to synergise their networks for broadband operations. While they had signed an MoU last year for a joint foray for Virtual Private Network (VPN) and broadband offering, sources said that the move to enter the NLD space was initiated after the government opened by this segment earlier this year.

“We believe that the consortium will not only benefit its customers by providing a variety of telecom services, but also the entire nation by creating a high quality and highly robust telecom infrastructure in the country,” a GailTel official said.

GailTel’s 15,000 km network connects 110 cities, Power Grid’s 22,000 km network connects about 60 major cities and metros, while RailTel’s 27,500 km-long route links over 2,200 towns, including metros, mini-metros and other important cities. The consortium also offers a unique advantage — the three players already have the requisite Right of Way (RoW) to lay fresh cables along pipelines, power transmission lines and railway lines. Besides, with overlapping networks in all major cities, they can offer quality and reliability.