State-run GAIL (India) Ltd, which has laid a vast network of fibre optic cables along the gas pipeline grid it operates, will sell bandwidth to newspapers, news agencies and TV channels at a 70 per cent discount.
GAILTEL, GAIL's subsidiary for the telecom business, has been leasing bandwidth to phone service providers like Videsh Sanchar Nigam Ltd, Tata Teleservices and Escotel. It is now tapping the print and electronic media to expand its business.
"Efforts are on to bring other customers into the GAILTEL fold, including Indian and foreign TV channels. Discussions have been held with TV channels like Star, Zee, Sahara, NDTV and some of them have indicated they would consider GAILTEL network provided the service levels and prices are competitive," company sources said in New Delhi.
The company will offer a discount of 70 per cent over the Telecom Regulatory Authority of India-approved rate of Rs 22 lakh (Rs 2.2 million) for leasing a 2 Mbps (megabyte per second) line.
The GAIL discount rate would be more than the 66.67 per cent discount offered by India's largest telecom firm Bharat Sanchar Nigam Ltd to newspapers, news agencies and TV channels.
"Newspapers and electronic media will be a new area for leasing bandwidth and at the same time will also be helpful in promoting the brand image of GAILTEL/GAIL," they said.
The revenue from the sale of per E1 (2 Mbps) bandwidth for a maximum distance of 500 km with 70 per cent discount will be Rs 660,000. The expected sale of 10 to 12 E1s during the next 12 months from this segment would generate GAIL an additional revenue of upto Rs 80 lakh (Rs 8 million).
GAIL had been unable to make a headway in getting business from print media and TV channels as it earlier offered only 54.5 per cent discount over the TRAI-approved rates. BSNL, on the other hand, offered a discount of 66.67 per cent.
"In order to take on BSNL and other competitors who have wider geographical presence and can offer multiple links, GAIL will have to aggressively price the services offered to this segment by offering higher discounts," sources said.
The company offers 63 per cent discount for customers leasing 34 Mbps lines and 68 per cent discount for those taking 155 Mpbs lines.