ISPs: Gateway Hurdles

Long ago, Mahatma Gandhi started the Swadeshi movement. One corollary to the
basic idea behind the movement would be that our country should take steps to do
value addition, rather then export raw material and import finished goods.

The facilitation of Internet usage and its wider penetration are some of the
objectives of National Telecom Policy 1999. An important step in that direction
was the ISP policy. Subsequent to that, the Department of Telecommunication (DoT)
started permitting private ISPs to commission their own international gateways
using satellite resources of their choice. This happened some time in February
2000. About 250 gateways have been permitted so far by the DoT, but only 40 odd
are operating. Why so?

Long-drawn
Process

After spending a considerable amount of money and time, various ISPs get the
‘in principle permission’ for setting up the gateway. This process can take
as many as 3—4 months. A long-winding process to obtain frequency, site
clearance, C-DoT monitoring equipment and NOCC approval is required to be
finished before one can start operating a gateway. The whole process may take 6—7
months, by an optimistic estimate. And by the time the process is completed, a
lot of technical and business assumptions get outdated due to the pace at which
telecom technologies are moving.

A capital expenditure of about Rs 25 lakh is required to set up a gateway.
The regulatory mechanism needs another Rs 14—15 lakh to be spent, before the
green signal can be given. The amount to be charged on these accounts should
have been cost-based rather than payment capacity based. The regulatory cost is
supposed to cover the cost of regulation and should not become a new source of
revenue for DoT. Various levies imposed by DoT amount to high indirect taxation,
thus defeating the basic purpose of not imposing a license fee on the ISP
fraternity.

This, of course, is in addition to the annual spectrum charges. It is well
known that the spectrum charges in India are exorbitant. No point comparing them
with other countries like China.

The satellite power has been increasing at a quick pace during last few
years. Thus a very small dish usually meets the requirements of link budgets. We
need to develop a mechanism akin to INTELSAT to type approve these dishes, and
then permit their use without NOCC approval. That would contribute in some way
in reducing the indirect expenditure as well the pre-operation time.

Let us also touch upon simplex (receive only) gateways. The DoT has decided
that these can be established, but by complying with the regulations as
applicable to duplex (both transmit and receive) gateways. Officially, all ISPs,
without a gateway permission, use VSNL facilities for up- and down-linking
operations. With the privatization of this company, the basic assumption of
public agencies controlling Internet traffic into India has become outdated and
irrelevant. In addition, it is understood that a large number of ISPs downlink
traffic from foreign satellites and uplink through VSNL/ STPI.

This is happening because the enforcement and adherence to the regulations
stipulated by the DoT are irrational and do not make business sense. One has
been given to understand that these regulations have been made to take care of
security aspect.

It is pertinent to note that our neighboring countries, which are much
smaller in size and have much less little military might, do not have such
propositions. So we have a very large number of Rx-only gateways in India
operating surreptitiously. This is not only resulting in revenue loss to DoT but
also a huge unregulated foreign exchange outflow.

Security clearance by innumerable agencies is an issue. The government needs
to tackle that in a manner that the process becomes smoother for genuine ISPs.
Probably there is a need to fine-tune the guidelines in a realistic and
pragmatic manner.

While taking a decision in this matter, the end-user or the consumer needs to
be uppermost in the mind of policy makers. It is he who ultimately suffers due
to these artificial costs and avoidable delays. Isn’t that basically a
negation of objectives of NTP ’99?

Sarvesh Trived