To: djane who wrote (4067 ) 4/23/1999 12:12:00 AM From: djane Respond to of 29987
Indian Satellite Policy in Transitionsatellitetoday.com Friday, Apr 23 Regulatory Review by Gerald E. Oberst Jr. Satellite industry representatives are cautiously optimistic that India will change its telecommunications policy to permit greater use of satellite facilities. The satellite industry has been hampered for years by restrictive Indian policies. Now, however, at a time when the government is anxious to expand telecommunications infrastructure, the timing is right to expand reliance on satellite networks. Among the problems that slowed development in India were policies designed to prevent the use of foreign satellites. For example, the government historically has insisted that VSAT operators use only the extended C-band frequencies provided on the national Insat satellite network. The result was that companies could not rely on global economies of scale, since virtually no one else used those frequencies and VSAT equipment for the Indian market basically had to be custom built. Worse, the Insat network offered insufficient capacity, so demand could not be met. Adding to these problems were regulations based on outdated technological assumptions, such as requirements that VSAT antennas be 3.8 meters in size and limited to data speeds of 64 kbps, at a time when industry standards have progressed to much smaller antennas with much higher data speeds. Moreover, the licensing fee structure sets higher fees (over $1,000 per terminal) for operators who sell hubbed services. Faced with this situation, the Indian satellite industry did not grow as quickly as expected. The Indian National Telecom Policy in 1994 established rules for VSAT data services and the government subsequently issued licenses to 14 operators. Only nine, however, were operational as of early 1999. As a result, VSAT demand has not grown to even one-third of its estimated size. This lack of development is discouraging, given the enormous demand for new communications lines in the country. Government regulators and policy makers may be moving away from some of these restrictions. For instance, in November 1998, the government established a group to recommend changes to national telecommunications policy, as part of a "New Telecom Policy 1999" (called the "NTP 1999"). In January 1999, that group released a discussion paper soliciting comments. The paper recognizes that telecommunications and information infrastructure are the keys to rapid economic development. Among the numerous suggestions in the paper is a proposal that satellite rules should permit use of transponders from foreign satellites when there is no available Insat capacity or where the government has not purchased or leased other capacity. Some responses to the policy paper argue, however, that restrictions should be eliminated altogether, rather than simply being replaced with a first right of refusal model. Industry representatives also continue to press for greater interconnectivity, lower fees and more flexibility on service arrangements. There is pressure to decrease high national tariffs for importing satellite equipment, which can help achieve national goals of creating additional communications infrastructure. The NTP 1999 recognizes the vast impact of convergence between media, telecommunications and computer services, particularly in the Internet sector. Among other suggestions, the new policies would allow Internet service providers (ISPs) to rely on satellite infrastructure. India already has loosened the Internet market by allowing new entry into the ISP area, rather than applying the 10-year duopoly that it earlier had established for basic service. However, at the same time India banned voice over Internet protocol service. This action limited the service opportunities for ISPs and may soon be just as technologically outdated as the size and data speed limits that apply to VSAT terminals. In recognition of this factor, the NTP 1999 proposes to eliminate the voice restriction. On the media side, there remains confusion over what the broadcasting rules ultimately will mean for satellite services. India's most recent national five-year plan, covering the years 1997 to 2002, recognized that under the current rules the government has had "some regulations but without effective control." There is an official ban on foreign satellite broadcasting-somewhat ignored-and a long-pending broadcasting bill would require that all signals be uplinked from within the country. On the mobile satellite side, the NTP 1999 reports that the government has opened up the market and issued a provisional license. Satellite personal communications systems will be authorized to offer voice and data services, with entry fee and revenue sharing structures to be determined by the national regulator. However, licensees must use the Indian international monopoly gateways or compensate the operator if those gateways are bypassed. India seeks to vastly expand its national telecommunications infrastructure and achieve important developmental goals for its mostly rural population. The country has a great pool of talent and a need to communicate globally that could be served by satellite networks most efficiently. Recent moves to permit greater reliance on satellite facilities are a welcome sign. Copyright © 1999 Phillips Publishing International, Inc.