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Bharti Group to split Mantra Online ISP business

15-August-2001
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Bharti Group to split Mantra Online ISP business

In a major restructuring, the consumer portion of Mantra Online’s ISP business will be split between Bharti Broadband Networks Ltd. — the Internet arm of the Bharti group and Bharti Telenet, which is engaged in basic telephony services.

Under the new arrangement, the consumer portion of Mantra Online’s business will become a part of Bharti Telenet’s basic telephony services offering and gradually cease to be a stand-alone business.

Mantra’s dial-up service may even be offered free with Bharti Telenet’s basic telephony services initially, just like it is being done in Madhya Pradesh under the Mantra FreeNet brandname.

For the dialup business of MantraOnline, Bharti Broadband will become a wholesaler for Bharti Telenet, selling it bandwidth and technology support.

Bharti Broadband Networks Ltd. — which was created by the merger of four Bharti companies like Bharti VSAT, Bharti BT Internet, Bharti Broadband and their holding company, Bharti Telespatiale — will now focus exclusively on corporate clientele.

Under the new dispensation, MantraOnline will also not see any of the flashy ad campaigns one had seen in the past or the frequent price wars which the major ISPs in the consumer space engage in.

Giving a hypothetical breakup of dial-up Internet revenue, Bharti Broadband Networks CEO Ashok Juneja, said that of every Rs 30 revenue for a 1-hour connection, Rs 24 will go to MTNL and only Rs 6 will go to the ISP.

And Rs 6 is below the cost of providing such a service. He added that till there is a revenue-sharing arrangement between the basic operator and the ISP, there couldn’t be a viable consumer Internet business.

On the enterprise front, MantraOnline will continue to remain a viable brand under Bharti Broadband’s umbrella, offering connectivity to corporate customers through ISDN, radio and leased line routes.

However, the company may create new brands in the corporate ISP space, in addition to Mantra. It is learnt that the company’s integrated network offering to companies, tentatively title `Networkthree’ may take the shape of a brand.

The Bharti Group is laying around 30,000 km of fibre all over the country, which will be leveraged by Bharti Broadband in providing Internet services to the corporates.

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