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BPO, IT Companies May Have To Pay More For 24x7 Broadband


By ugesh sarkar, Section Internet Service Providers
Posted on Tue Dec 23, 2008 at 03:47:43 AM EST

Operators Mull Increasing Price Of Leased Lines

BPOs, IT firms and enterprise users of Internet should brace up for higher prices of bandwidth if they want capacity that is disruptionproof even in case of disasters like the latest undersea cable cuts in the Mediterranean region. Operators are mulling increasing prices for offering round-the-clock or restorable leased line services, top industry sources told ET.

Leased lines are dedicated circuits which provide permanent Internet connectivity and are heavily used by IT and IT-enabled services industry for voice and data transfer.

The simultaneous disruption of services on submarine cables SeaMeWe3, SeaMeWe4 (backed by 16 telecom companies) and Reliance Communications' Flag in the Mediterranean region has highlighted the need for submarine cable operators to have capacity on cables on different routes. While it will provide full redundancy (back-up) in case of a disaster, it will jack up costs for operators. This is because they have to keep capacity free 24X7 on a different cable route. This cost of keeping spare capacity will be passed on to end users.

 "Operators are thinking that enterprises must pay more if they want highly secure and reliable connectivity amid increasing incidents of cable cuts. Service providers will keep back-up on another route, rather than on nearby cables, which may also be affected in a disaster," said the source. While SMW3 and SMW4 have restoration contracts, meaning that one will take the load of another in case of a disaster, in the latest incident, both the systems have been impacted at the same time and in the same region. Coupled with breakdown of Flag, around 80% of users were affected in India.

WHAT ARE LEASED LINES?
TYPES OF SERVICES
HOW'S IT GOING TO UP COST?  
Click On "Full Story" For Read These Points..

Further, in regions more prone to cable cuts, like the Mediterranean, operators are looking at keeping more ships in readiness to reach the site in the shortest possible time. In this incident, RCOM took almost two days to dispatch the ship with repairs. "We will have to invest more in keeping repair ships in readiness closer to regions where frequent cuts are taking place. This will also increase the cost of connection for customers," said another industry official.

Acsendia Consulting principal analyst Alok Shende told ET that with the increasing reliance on Internet as a medium to deliver corporate services to customers, Indian enterprises can ill-afford outages that have been happening at increasing frequency. "Such demanding enterprises are set to pay marginally higher prices to avail higher redundancy from Internet service providers," he said. As of now, Bharti Airtel (part of SMW4) and Tata Communications have diverted traffic to alternate routes. RCOM has diverted the traffic via Pacific region.

WHAT ARE LEASED LINES?
Leased lines are dedicated circuits which provide permanent Internet connectivity and are heavily used by IT and IT-enabled services industry for voice and data transfer.
TYPES OF SERVICES
Operators offer two types of leased line services--restorable and non-restorable. In case of restorable services, as soon as the original cable in cut, traffic is automatically diverted within a few seconds. However, in case of non-restorable services, cable operators may take time in finding alternate and additional capacity.
HOW'S IT GOING TO UP COST?
While it will provide full back-up in case of a disaster, it will jack up costs for operators. This is because they have to keep capacity free 24X7 on a different cable route. This cost of keeping spare capacity will be passed on to the end users.

Source: Economic TimesBPO, IT companies may have to pay more for 24x7 broadband

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