The submarine cable brings 100G to London and New York

Carrier services firm Tata Communications, which is part of the India-based Tata conglomerate, this week upgraded its trans-Atlantic TGN-Atlantic (TGN-A) subsea cable to run 100Gbps between New York and London.

The upgrade will bring increased bandwidth for businesses and carriers on both sides of the Atlantic to meet growing capacity demands driven by the increase in cloud computing and high-bandwidth services including music and HD video downloading.

Genius Wong, SVP of global network services at Tata, said the implementation will pave the way for further upgrades leading to multifold increase in bandwidth availability across Tata’s global network, which consists of 210,000 kilometres of terrestrial and subsea network fibre.

Tata claims to have the only fibre optic ring around the world, making up 20 per cent of the world’s internet routes and carrying 4,200Petabits of traffic per month on its internet backbone.

Tata tapped Ciena and its GeoMesh offering for the upgrade, including its 6500 Packet-Optical Platform powered by WaveLogic 3 coherent optical processors and optical bypass.

The first phase of the deployment will bring the 100G capability to the New York-London route and expected to be in full service during the first half of 2013.

The network will enable financial firms to execute a high frequency trade between locations, such as London and Hong Kong or New York and Singapore. Tata claims the multipoint service has been designed to offer up to 35 per cent savings on circuit and operations costs and service level agreements (SLAs) include near-real-time latency guarantees.

In related news, US-based carrier Verizon has announced a major upgrade to its IP network infrastructure across Europe and the US. Boosted by the Juniper Networks’ PTX series multiprotocol label switching (MPLS) platform, the capacity of  Verizon’s IP backbone has increased to  a blinding 8Tbps.

“Service providers face significant operational challenges as packet data traffic volume across global wireline and broadband wireless networks is forecast to increase seven-fold by 2015, driven by significant increases in internet, IP data, video, over-the-top traffic, content distribution networks and mobile data traffic,” said Nav Chander, research manager, enterprise telecom at IDC. “Verizon’s decision to deploy a next-generation packet optimised core transport solution helps Verizon better prepare and manage this network growth for the diverse packet data applications across its global network infrastructure and portfolio of wireless and wireline services.”

He has been sat in a cell for over a year, refusing to post bail and stands accused of taking bribes to sell spectrum to prospective mobile operators at discounted rates; “virtually gifting away an important national asset at throw away prices” in the words of a Supreme Court Council of Ministers.

India’s 2008 2G licence sale was intended to attract foreign investors into India, and after spectrum was purchased by Indian companies, a number of overseas players did indeed entere the fray. Norway’s Telenor, Sistema of Russia, Etisalat of the UAE and Batelco of Bahrain all joined forces with Indian businesses to launch services to the country’s 1.2 billion-strong population.

Telenor partnered with an Indian real estate firm, Unitech, which bought spectrum in the 2008 sale, while Etisalat set up a JV with Swan Telecom, a new company set up by the founders of another real estate firm, DB Realty. Reliance Telecom also subsequently purchased a 9.9 per cent stake in Swan Telecom.

Swan and Unitech are alleged to have played a part in the corruption scandal, which leaves their foreign partners twisting in the wind.

Special public prosecutor U.U. Lalit, representing the Central Bureau of Investigation (CBI), questioned the circumstances in which the spectrum was acquired:

“Swan Telecom and Unitech got the telecom licences despite their complete ineligibility [to use them]. Both the companies off-loaded their shares soon after getting the licences and garnered around Rs 7,300 crore ($1.48bn) in the process,” he told the Supreme Court.

Meanwhile, Shyam Telelink Limited and Shyani Telelink Limited decided to operate together with their combined 21 licenses, and during late 2008, Russia-based group Sistema bought majority stake in the company, which now operates under brand name MTS India.Bahrain’s Batelco set up a subsidiary company, BMIC Limited, which acquired 42.7 per cent equity in STel for BD65.8m ($174.5m).

Now though, all of the companies that bought spectrum are set to lose those licences, and no form of compensation is on the cards.

Telecoms.com understands that the companies now under investigation by the CBI are Unitech, Reliance Telecom, Swan Telecom, Loop Telecom and Essar. Energy group Essar was found to have a controlling stake in Loop while also holding a stake in Vodafone.

It has been suggested that Unitech and Swan Telcom sold stakes in their firms to Telenor and Etisalat at much higher rates than acquired them for. Telenor Group injected INR 61.35bn ($1.25bn) operating capital directly into Unitech Wireless to take a majority stake in the company. Etisalat has said it invested more than $1bn into Etisalat DB. It has been reported that Unitech’s 22 Pan-India licences cost a mere Rs.1,658 crore ($337m) at the time of purchase.

For now the foreign investors are not being accused of conniving in any part of the scandal. In addition to the fact that they all paid higher rates for access to the spectrum, there was apparently little or no suspicion of any corruption in the 2G spectrum allocation at the time that Etisalat and Telenor decided to invest. And they, it seems, did not find any cause for concern when they did their due diligence.

Having blundered into this mess, they now face the prospect of losing substantial investments; and of being forced to lay out more capital if they want to stay in a market where they have built significant subscriber bases. They couldn’t be blamed if they decided to write the whole thing off as a bad job, but they seem motivated to pursue their Indian adventures.

Telenor’s VP for group communications for mobile, Tor Odland, told Telecoms.com: “We definitely don’t think of it as a lost cause. It will be challenging but we are inspired to continue.”

Batelco has exited the Indian market in the short term, selling its stake in STel to Indian firm Sky City Foundation Limited for the same $174.5m that it acquired it for. However, the Bahraini operator intends to re-enter the Indian market after the sale is complete and said that it is open to other opportunities later down the line.

Etisalat has written off a figure of $827m, the value it places on its operation in India, and warned that it may suffer a further financial impact as a result of the scandal, but the UAE operator said it is still considering its strategic options in India.

As if to rub their noses in it, the new Indian telecoms minister seems breezily unconcerned about their plight.In comments to the local press Kapil Sibal said: “Protection of interests is not the function of the government. Any party that feels aggrieved can approach the courts.”

(This appears to be at odds with what is happening elsewhere in the country, as India has recently liberalised foreign investment regulations in many of its key sectors, opening up commodity exchanges, credit information services and aircraft maintenance operations to foreign firms.)

The extent of corruption in India has now presented itself on a world stage, and if the allegations made against Raja and the other defendants in this case are true, it suggests that fraud and corruption are still a deep–rooted problem in India – just not enough of one to deter foreign investors like Telenor and Batelco. It seems strange that the aggrieved foreign investors are not making more of a fuss about their losses.

Since the partnership with BitGravity, Tata has claimed successful traction with high profile media, content and gaming companies

Tata Communications, the carrier services arm of Indian conglomerate Tata Group, has acquired a content delivery network (CDN), better equipping the firm to help network operators deliver media assets to end users.

Tata has purchased 100 per cent of BitGravity, it has partnered wtih since 2008, investing $11.5m along the way. BitGravity will operate as a wholly-owned subsidiary of Tata Communications and terms of the transaction are not being disclosed.

BitGravity, a privately held company located in California, was founded in mid-2006 and launched its services in 2008.

Since the establishment of the partnership with, Tata has claimed successful traction with high profile media, content and gaming companies in Europe, Asia and India such as NDTV, IAH Games, Quick Heal Technologies and Nimbus Communications.

“Two years ago, we made an investment in BitGravity to provide content delivery services for Tata Communications” said Genius Wong, senior vice president of global network services at Tata. “We can now fully invest in the potential that exists around the globe and accelerate the delivery of new features and services to our customers”.

Profile: Tata Communications

The Tata Group is India’s largest conglomerate, with 98 businesses in everything from trucks to tea. Last year, its revenues equated to about 3.2 per cent of India’s GDP. Now it is throwing its weight behind WiMAX.

For better or worse, India is famed for its bureaucracy. For Shankar Prasad, the bureaucracy is “the single biggest bottleneck for broadband in India”.

It has forced him into an unusually frank admission for a salesman. “When a customer calls up more often than not we have to say: ‘sorry, we can’t provide you with broadband’.

The president of the Retail Business Unit of Tata Communications (formerly VSNL), explains.

“To provide broadband connectivity to individuals in India you need to lay copper or fibre and you need a lot of permissions, and lots of licences. A city ‘covered by broadband’ typically means only small areas of that city. The broadband reaches where the money is.”

With the ground often inaccessible, service providers resort to threading wires across the rooftops, where they are exposed to the elements. The result? “The customer experience is pretty bad.”

Little wonder then that Prasad says that of Tata’s three main businesses-international voice, enterprise internet, and retail broadband- the biggest is the enterprise business, the smallest the retail business. Enterprises can better handle both the bureaucracy and the expense.

It’s a pretty convincing case for wireless connectivity in a country of 1.1 billion people, 216 million telephones but only 2.7 million broadband users.

Prasad and Tata “expect WiMAX solutions can address that space.”

The Indian government has set a target of 20 million broadband users in the country by 2010. “We believe there is a far bigger market beyond 2010, but for now our eyes are on that 20 million,” says Prasad.

It has been reported that Tata plans to spend $500m-$600m rolling out WiMAX networks but Prasad won’t comment on his spending plans.

Network profile

Tata’s WiMAX solutions are divided into bespoke enterprise sector solutions and retail business solutions. It does not as yet offer services for the consumer sector.

For enterprise customers it is rolling out WiMAX base stations as per the customer’s coverage requirements, whereas for the retail sector it will offer general wide area coverage.

For the time being Tata’s WiMAX base stations are co-located on masts owned by sister company Tata Teleservices, which operates a CDMA mobile phone network.

Tata is operating 802.16d equipment in 3.3GHz spectrum, India’s unique frequency allocation for fixed WiMAX services. US-Indian vendor Telsima is supplying the equipment, which includes base stations and outdoor CPE.

This follows a four-base-station trial with Telsima late last year when Tata tested WiMAX with 80-100 enterprise customers, offering modest throughput speeds of “between 128 kbps to 512 kbps” from sites that varied in range from about 400 metres radius to about one kilometre radius.

“We mount the CPE outside the building and then run a wire to the computer or to a Wi-Fi router in the building,” Prasad explains. “The direct connection to the computer is more common right now.”

He continues: “Naturally as we progress we are going to use indoor CPE bit for now we are still learning about the network coverage. Once we get comfortable with the coverage we will be testing indoor CPE.”

Coverage is dependent in part on spectrum assets and, once again, India’s bureaucracy is not helping Prasad’s cause.

“We have only 10MHz. That is not enough. Around the world WiMAX operators have 20-40MHz. Around the world the most relevant frequency band is 2.5GHz. We would love to have 2.5GHz spectrum but we are working with 3.3GHz.”

One of the most immediate effects of Indian WiMAX falling in line with global standards would be to reduce the price of Tata’s WiMAX CPEs that currently cost about $250, according to Prasad, well beyond the reach of most consumers and even some SMEs.

“Right now we don’t sell the CPE, we give it to the customer but it belongs to the company. If the customer cancels and moves on we keep the CPE,” he explains.

Soft launch

So far, Tata has launched enterprise services in 10 cities including Bangalore, Chennai, Puni and Hyderabad, for example building out 20-30 sites in Chennai.

Already it counts among its customers some big names, including Hyundai Motors, Bajaj Allianz insurers, Coca Cola and Mahindra resorts. Tata is directly selling into the enterprise, contacting the customer, assessing their needs and crafting a WiMAX solution.

Its first and only foray into the retail sector has seen Tata deploy 120 WiMAX base stations in Bangalore that cover some 85 per cent of the city.

Tata’s service proposition is simple: access. It is not as yet moving into providing any WiMAX service specific value added services, says Prasad. “We are providing last mile connectivity. That is what we are doing with WiMAX. If customers want to use VoIP or other VAS they use internet-based solutions.”

In January Tata soft-launched this network and is currently using several sales channels to approach customers, including a direct sales team and outside channel partners, generally local dealers of computing equipment and office equipment.

What of those long-suffering individual consumers, who Prasad has so often had to disappoint? They will have to wait.

“We are not selling directly to consumers,” he says. “It is not a retail product as if selling a mobile phone in a shop. In the long term, absolutely yes, it will become a retail product.”

Tata’s retail business service plans are, claims Prasad, broadly in line with existing wireline broadband service plans.

“We are offering a minimum of 256kbps. Service plans are for three, six and 12 months and cost on average about 1500 rupees ($38) a month,” he says, adding that Tata is competing against any operator in the broadband space. “Bharti, Sify and Reliance, the incumbent BSNL, we are competing with fixed broadband.”

All the operators Prasad mentions are also moving into WiMAX, so how will Tata differentiate?

Other than claiming a better product, better quality of service and customer service, Prasad also mentions Tata’s content development division within the broadband unit.

“Through our Tata Indicom website we are offering some of the latest blockbusters to be downloaded and viewed, from Yash Raj films, one of the biggest film distribution houses,” he explains.

When a Tata WiMAX user logs onto the internet they are immediately directed to the Indicom website where they can access the content exclusive to Tata customers. In the soft launch phase there are no services or applications exclusive to users of the WiMAX service.

“Whatever broadband products we are offering are the same products customers can get through WiMAX,” confirms Prasad.

Mobile WiMAX can wait

There have been press reports that Tata has put out large-scale RFIs for 802.16e equipment, but Prasad plays down the prospect of mobile WiMAX, citing uncertainty surrounding spectrum and the case for WiMAX mobility.

“When we get clarity on spectrum we will be interested in 802.16e but that would be for portability. We are still awaiting regulation on mobility. I don’t think WiMAX is going to compete with mobile services, I don’t think people are looking for broadband on their mobile phones.”

He continues: “Today we are struggling to provide fixed broadband and so we need to concentrate on fixed broadband before thinking about mobility.”

That struggle continues as Tata feels its way into the WiMAX world, and Prasad suggests that the biggest challenge his company has faced has been the sheer novelty of the technology.

“It is like going back to rolling out mobile networks,” he says. “So many people are learning on the job as we roll out and learn what does and doesn’t work. For example, we are not able to predict exactly the coverage for each WiMAX base station, each time we are learning only after trial and error.”

Nevertheless, Prasad declares himself happy with what he has seen so far, he has some major enterprise customers already and, in the coming months, as regulatory bottlenecks are hopefully cleared, he might even have cause to give thanks to India’s famed bureaucracy.

India’s struggle for spectrum

Recent reports suggest that Prasad’s wishes may be granted. In mid-January the Department of Telecom (DoT) requested that the Department of Space and telecom operators vacate the 2.5GHz spectrum they occupy to make way for wireless broadband services.

About 40Mhz in the 2.5GHz band is used by the space agencies and another 40MHz is used by telecom operators for back-end microwave links.

The Hindu Business Line reported that the DoT had set a deadline of February 28 to the incumbents to relocate to other specified frequencies.

“The wireless users/operators who have assignments in the frequency band 2.5GHz as well as 3.3GHz are required to shift their operations from 2.5GHz band and consolidate in 3.3-3.4GHz band immediately. Further, the operators who have assignments only in 2.5GHz band are required to relocate their operations from 2.5GHz band to 2.7-2.9GHz band,” the order said.

The Department of Telecoms is reportedly proposing to auction three licenses and 60MHz of spectrum at 2.5GHz to existing operators, with plans to reserve one wireless-broadband license for state-owned BSNL and MTNL to share.

However, the Department of Space has raised concerns about this reallocation and has been holding up the process for some time. Furthermore, there is a campaign by India’s GSM operators to allocate 2.5GHz spectrum to them.

“It is a huge problem because a lot of operators want spectrum for mobile telephony as well as wireless broadband. That is pending with the government. When we get clarity on that we can take decisions going forward,” says Prasad.

Deutsche Telekom is going to offload its IT systems integration division T-Systems, according to local reports.

The report in German weekly newspaper Focus claims that Indian conglomerate Tata has had an undisclosed offer accepted by the German telecoms company.

DT employs about 13,000 IT specialists. The German paper reckons half that number could lose their jobs as Tata relocates the business to India.

With news of Nokia’s plans to close down its Bochum handset manufacturing plant fresh in the mind it’s a worrying time for German IT experts.

Also in India, Nokia Siemens Networks today announced that it has been awarded a pan-India contract from Bharti Airtel Limited for deployment of a single interactive voice response (IVR) platform.

The platforms are HP OCMP (Open Call Management Platform), Video Gateway, Televoting Application and ASR/TTS (Automatic Speech Recognition / Text-to-Speech Engine. The solution will be ready for commercial operation by April 2008 and is expected to scale up to one billion minutes of usage per month in three years for Bharti Airtel.

“Our decision to select Nokia Siemens Networks as our partner in this programme is based on their project delivery record,” said Manoj Kohli, president and CEO, Bharti Airtel Limited. “Their single IVR Solution and Voice Service Delivery Platform is based on a best-of-breed integrated approach which will result in cost optimisation and increased security, a key prerequisite for building world class services.”