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What are MTNL's recent achievements?

We have launched 3G services, which is a significant milestone. MTNL is the first operator in India to offer 3G services, which makes anything possible including mobile TV, high speed internet, voice over IP and a lot of value-added services.

What are your future plans for 3G?

We are initially targeting 100,000 3G subscribers in a single year. Going by the relatively high broadband average revenue per user (ARPU), we expect 3G ARPU to be higher than ARPU from 3G services.

3G will become an absolute must for business users as they will be able to download emails etc. The youth can access services like gaming, video conferencing. Basically, anyone who is not computer savvy or does not want to spend money on a computer will benefit immensely from 3G.

How has MTNL performed in the broadband segment? Has the IPTV service taken off?

MTNL's broadband service has been very successful. Our subscribers have had a very good experience and we have been consistently selling around 1,000 broadband connections per day.

MTNL started the service in mid2005 and has already reached 650,000 subscribers.This figure could have been significantly higher if it was not for our capacity constraints –­ we just didn't anticipate such an overwhelming response. We are now expanding our capacity to 2 million to cater to the surplus demand.

IPTV services have also started picking up substantially. We have over 50,000 subscribers. Triple-play was a new service and so the network took some time to stabilise. We now have plans to get into fibre in many places for triple play. On fibre, the quality is unmatched. Even on copper, the quality is comparable to DTH.

Is MTNL experimenting with other technologies and applications?

Technologically, our network has always been a step ahead of other operators. We have a multiprotocol label switching backbone in our city network. Broadband is run on ADSL2+. MTNL is the only operator to offer 3G services and was the first to provide IPTV services. We are still the dominant company in IPTV and offer services using the latest technology, MPEG4.

The company is now moving towards next-generation networks (NGNs). Our 3G GSM service is based on an NGN. We are also moving our fixed line service to NGNs and are introducing such networks in the exchanges soon. We will offer IP multimedia services to subscribers in a year or so. MTNL is also migrating its backbone from time division multiplexing to a totally IP-based one. Eventually, the whole network will be end-to-end IP.

How is the financial crisis likely to impact the company?

We will not be affected by the financial crisis as we don't have any liquidity issues. MTNL is a zero-debt company and has sufficient cash. If there is a general slowdown in business, there is a tendency for people to be careful in their spending on telecom. So, maybe this will affect revenues to an extent. However, the sector has been growing anyway and, so far, we haven't felt any impact.

Are there any overseas expansion plans?

We currently offer CDMA-based services in Mauritius, and are planning to offer GSM services in the country. In fact, the Mauritius operations have broken even and we are generating substantial revenues. We are also laying a submarine cable between the west coast and the UAE and Djibouti, and one through Singapore and Malaysia. Our aim is to provide end-to-end bandwidth in Europe and the US. We are also looking at new telecom licences, tenders.

As a regional player, how do you plan to compete with larger private operators?

MTNL's strategy for growth is to provide new services in areas where it is present. There are also plans to expand abroad. We think Africa has a lot of potential.

What are your key issues going forward?

We have 5 MHz spectrum for 3G, which is less than the international norm of 20 MHz. For some 3G services, 5 MHz is not sufficient. Initially, when the subscriber base is low, it will be okay, but when the number of users grows, this could become a problem.

Today, quality of service (QoS) is an issue for the industry and for all operators. This is because with multiple operators, interconnect issues crop up, spectrum gets divided. There has been huge growth in the subscriber base, due to which networks must be constantly upgraded. This becomes a problem as new tenders lead to interoperability issues. Given our regulations, it becomes difficult to upgrade the network constantly to match growth. However, we do our best and MTNL is ahead of other operators on many QoS parameters.