You can surely set up an IP Telephony Business in India

India is perhaps the only big telecommunications market in the world that

does not have any policy on IP telephony at all. This lack of policy has

resulted in confusion with regard to what is allowed and what is not in the

country when it comes to IP telephony applications. Moreover, it appears from

various pronouncements that the government itself is not clear as to what

exactly IP telephony means. This inference can be drawn from the fact that the

government’s periodic statements talk only about Internet telephony. A case in

point is a recent government document that calls for lifting of the ban on

Internet telephony.

As such, the governmental brief confines itself to a blanket ban on Internet

telephony. This essentially means that no voice call that bypasses the PSTN

networks and uses the public Internet is allowed. As such all PC to PC, PC to

phone and phone to phone calls over the Internet are deemed illegal and liable

for punishment. Besides, ISPs or for that matter any other service provider who

have not been licensed to offer voice services are not allowed to offer voice

services and compete with basic service providers outside a closed user group.

Period. The ban stops here.

There is no ban on IP telephony per se. There is no ban on a licensed basic

or long distance service provider deploying an IP backbone and carrying voice

traffic over a network that has IP capabilities. The service provider is free to

offer any type of application that is possible on a VoIP network, that is, a

managed Internet network. A service provider is also allowed to add IP

capabilities to its existing circuit switched networks. This is already being

done by BSNL and Bharti Telenet Limited in Madhya Pradesh.

The government does not also prohibit closed user group Internet telephony or

Voice over IP. This means that if an organization wants to set up an IP-based

intra-organization voice network, it is free to do so. It can freely use the

services of ISPs or any other service provider for this. Contact centers/call

centers are also permitted incoming voice calls, with special approval from the

regulator.

In a nutshell, anybody with an intention to set up an IP telephony operation

in India would have to seek a license for a basic telephony service. However, as

of today, they can only be allowed to offer phone to phone voice besides other

value-added services over their managed network. They cannot offer PC to PC or

PC to Phone voice services except to close user groups.

However, getting a license in India based on a pure IP-centric business model

will not be an easy task. Prospective entrants could face attitudinal and

perceptional hurdles from the regulatory establishment, major sections of which

remain largely insensitive to the emergence of IP telephony as a more

cost-effective and efficient alternative to circuit-switched telephony. However,

this roadblock could go if the government has its way with the proposed

Communications Convergence Bill that provides for a composite license for all or

a combination of services. If the government’s current honeymoon with

liberalization and its recent pronouncements are to be given credence, then

there are good chances that India would see complete deregulation in the IP

telephony space.

The government could be just one of the problems that a pure IP voice and

data player could face in India. Bandwidth scarcity could be their biggest

obstacle. India still needs more bandwidth capacity to support trouble-free

delivery of voice over packet networks.

IP telephony service providers will also have to address issues related to

and arising out of IP-PSTN inter-connectivity. This is important in context of

the fact that most telephones in India are likely to remain connected to

circuit-switched telephone networks for a long time to come.

Wholesale Phone to Phone Voice Services

Least Call Routing



Just as many telecommunication carriers employ IP telephony in their

backbone networks, several operators sell IP capacity (often combined with

termination services) as a least-cost routing solution for international calls.

Given the increasing prevalence of this type of transmission, many callers are

probably already making IP telephony calls without knowing it. Pulver.com’s

"Minutes Exchange" acts as a "market maker" between parties

originating and terminating IP minutes.

Call Termination



Hundreds of small companies, many related to established ISPs, offer
international call termination in almost every country in the world (including

many where IP Telephony is prohibited). Some of these firms are full-service

clearinghouses and offer billing services as well. The barriers to entry are low

and so are the prices. See, for instance, the list of termination rates around

the world available on the IPxStream web site, or that of Arbinet-TheXchange,

where the prices quoted are often below the settlement rates, which would

otherwise apply. IP telephony minutes are being terminated on the PSTN just

about anywhere the Internet reaches.

Source: ITU