Online wallet company, Oxigen has initiated talks with the government-run BSNL to start providing Virtual Network Operator (VNO) by the end of this year. The company intends to take bandwidth on lease from the telecom operator to provide its services.
The telecom department released guidelines for VNOs on Friday last week. The company, therefore, wants to capitalize on its last distribution network and being one for the first players in the new market. This new move is likely to push down the cost of providing services and allow them to cut down on tariffs. VNOs are extensions of Network Service Operators and are not allowed to install equipment to facilitate telecom operator services.
“We are in talks with foreign players who have expertise in VNO business and can help us in setting up a network. Our focus will be providing data services starting from North East and Central part of the country and then gradually be a pan-India operator,” said Oxigen Chairman and MD Pramod Saxena.
The company has 2 lakh access points in the country apart from the online reach, and is planning to provide value added services by leveraging Oxigen as a VNO. There is no restriction on the number of VNOs that can operate in a particular area, and more importantly no restriction on how many VNOs are linked to a telecom network. So if the BSNL deal with Oxigen goes through, BSNL can also provide the same service for another company. Whether or not VNOs can be linked to multiple companies remains unclear at the moment.
Being one of the top five largest data consumers in the world, India provides a massive market for VNOs with close to half a billion data consumers. This move is bound to create a market boom and is likely to attract many more players.