Videsh Sanchar Nigam started processing the first batch of orders from ISPs and corporates for Internet leased lines under its revised tariffs and payment scheme. This follows a ruling by the Madras High Court on January 4, allowing VSNL to implement its revised tariff and payment scheme for all customers, except Satyam Infoway and DishnetDSL - the two petitioners who have sought a stay on one aspect of the revised scheme which required ISPs to pay VSNL six months in advance.
Under the revised tariff scheme, Internet leased lines will be cheaper by 70 per cent. A 2 mbps leased line will now cost Rs 12.5 lakh per annum as compared with Rs 41.8 lakh earlier. Along with the revised tariffs VSNL has also introduced a new payment scheme whereby ISPs and corporates alike will be required to pay the tariff six months in advance with a 20 per cent rolling deposit.
The new tariffs became effective from January 1, 2001, but VSNL was unable to implement the same because of the petition filed by Satyam Infoway and DishnetDSL, both Chennai-based ISPs, soon after VSNL announced the revised tariffs in October last year.
The six-month advance payment clause is not the only aspect of the scheme that has irked several ISPs. Close on the heels of announcing the tariffs last year, VSNL also announced that ISPs would no longer be eligible for the 15 per cent discount they enjoyed on leased line rates.
For VSNL itself, revenues from Internet leased line will reduce substantially. For every 45 mbps line that it leases out it will receive Rs 2.6 crore per annum. The loss in per leased line revenue will be more than compensated by the additional volumes that will be fuelled by the higher demand.