Telecom services wing of GAIL (India), GAILTEL, has planned to set up 3,000-km optical fibre network in southern India. According to General Manager JK Singh Teotia, an investment of Rs 60 crore will be made in the proposed OFC network expansion project in the running financial year. About 400 km of OFC network will bridge Delhi, Mumbai, Pune, Hyderabad, Bangalore and Chennai, while the final network will connect 100 cities across the country, he says.
Chairman and Managing Director Proshanto Banerjee says, McKinsey & Company has recommended the expansion strategy and a service network expansion model for the company. As per the recommendation, an Internet Protocol – Multi Protocol Label Switching (IP-MPLS) network connecting 100 cities in the country will be set up soon. The network will be expanded on a marginal cost basis along the National Gas Grid and City Gas networks. As a part of this project, GAILTEL will create a network stretching across 20,000 km trunk routes and 20,000 km across city networks. As Banerjee informs, pipelines laid for gas distribution in cities will be used for installing the optical fibre cables. The company will also set up data centers and bandwidth exchanges across the country.
The network will provide a whole range of broadband services at a substantially lower cost, claims Banerjee. GAILTEL is also contemplating on tie-ups with broadband service providers for a long-term network lease contract.
However, the state-owned telecom service group has recorded a 75 per cent growth in business in 2003-04, touching Rs 20.5-crore mark compared to Rs 11.71 crore, posted last year. The bandwidth sales have increased from 482 mbps to 1,230 mbps. The company enjoys a clientele comprising telecom service providers like Hutch, Escotel, Tata Teleservices, Data Access, Bharti Infotel and VSNL.
The new service models will be end-to-end bandwidth services, based on marginal cost model. GAILTEL has control over about eight per cent share in the Rs 220-crore IP market. New businesses worth Rs 8.23 crore will be added to the company’s kitty this fiscal after a loss of Rs 17.76 crore from VSNL. As Teotia informs, a Rs 6-crore deal is under negotiation.