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High bandwidth prices may hit BPOs

Rajesh S Kurup in Mumbai | July 19, 2005 14:56 IST

The next time an Indian business process outsourcing misses a deal, it could be due to the uncompetitive price tag the company might have quoted.

The BPO firm cannot be blamed as the bandwidth, an essential commodity for ITeS and BPO companies, prices in India are ruling sky high than that elsewhere in the world.

High bandwidth prices are likely to hit BPO and ITeS operations, making them uncompetitive. This would also result in the country missing the target of garnering 30 lakh (3 million) broadband subscribers by the end of 2005 and losing out business to other competitive countries, said Deepak Maheshwari, secretary, Internet Service Providers Association of India.

India has achieved 332,000 subscribers and achieving the balance 89 per cent seems impossible due to high international bandwidth charges.

The total number of subscribers rose to 396,000 in June 2005, which is still lower than the December 2005 target by 84 per cent.

International private leaseline circuit prices in India "continue to be around five times costlier than similar economies in the Asia-Pacific region," he said, quoting a Gartner study.

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