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Who Needs Bharat Sarkar!

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VoicenData Bureau
New Update

Last fiscal saw the beginning of

the end of the indispensability of the Government in the sphere of communications in the

country. Consider this. Time was when there was too much dependence on the political

framework of the Central and State Governments. Time was when one lived in the perennial

fear of one’s equipment business going into doldrums because of a single small

decision taken in the conference rooms of the Sanchar Bhavan. Time was when it took the

better part of a decade for a telephone connection to be installed at one’s home.

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Now consider this. The Central

Government has changed four times in the last three years, with a fifth time pending

currently. And this has not in the least affected the telecom scenario in the country. The

wheels of liberalization did not falter and the basic telephony and Internet services got

deregulated. The infrastructure equipment vendors who, till now, were restricted to only

three customers—DoT, MTNL, and VSNL—got the taste of a broad-based market-place

with the opportunity to sell to more than those three outfits. The consumers are

experiencing the availability of more alternatives to buy their telephone connections

from. So on and so forth.
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This change is bringing about a

big shift in the dynamics of India’s communications business. For one, the formation

of Group on Telecom (GoT) is shifting a lot of the policy making burden away from the DoT.

The latter is purported to be corporatized in the coming years. Second, the DoT, MTNL, and

VSNL are just one of the outfits in the service industry, as opposed to being the only

ones. Third is the introduction of competition in the telecom industry, with the

government outfits being forced to become more customer-service oriented, and thus

behaving in a more corporate manner.

In the enterprise segment, there

was this big boom in networking witnessed last fiscal. Despite cries of recession,

corporates stepped on the accelerator, as far as connectivity was concerned. If in the

previous years, computing took precedence over networking, it was the reverse case last

fiscal. This was mainly due to the attitudinal change of management toward IT. Fueled by

applications such as ERP, intranet, extranet, networking attained the status of being

corporate infrastructure, equal to computing in importance, if not more.

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These factors have fueled the

dormant hope in the communications industry. Hope that got stymied in the aftermath of the

Sukhram episode; hope that got crushed with the cellular operators’ imbroglio with

the DoT; hope that got frustrated with the Government’s emphasized focus on software

exports leaving the communications industry orphaned. This hope got revived last fiscal.

Although last year would not reflect many of the things mentioned here in actual monetary

terms, it built the foundation for future revenues.

Thus, last year paved the road to

the redundancy of the Government in all the spheres of communications. The era of the

Government being the "Be all and the end all" is getting over. That the

indispensability that the Government enjoyed is over can be seen in the way the DoT and

the PSU telecom companies reacted during the end of last year and the beginning of the

current year. For one, the DoT announced that it would add a whopping 18.5 million lines

by 2002, which effectively means that the Department would be nearly doubling its existing

base (19.45 million direct exchange lines as on 30 November, 1998). MTNL announced its

intention to enter into cellular services and has already entered into Internet services.

VSNL spun off its Internet services business as a separate subsidiary. These were clearly

reactionary measures dictated by the emerging competition in the industry.

All these contributed to the

revival of hope in the economy regarding the future of communications. And the dream: A

smart communications industry driven more by entrepreneurial ability rather than

bureaucracy. 

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