Internet Service Market in Nepal

By:

Sanjeev Maharjan

Contents

Internet History in Nepal Growth of Internet Market Internet Market Today Earlier Technologies Introduced By ISPs Need for High Speed Internet High Speed Technologies Introduced by ISPs ADSL as Superior Technology Why to prefer ADSL? Lessons for us!!!

Internet History in Nepal E-mail services by Nepal Academy for Science

and Technology: First instance of use of Internet Technology

Mercantile Office Systems: First Private Sector to provide commercial e-mail service in June 1994

Internet Services by Mercantile Started: Connection with Singapore Telecom via 64 kbps

leased line through NTC in 1995 Mercantile became the First ISP of Nepal

Internet History in Nepal

1995: 2 more ISP proposed to start Internet services

World Link Communications & Computerland Communications

September 1997: License issued to all three ISPs 1998: Formation of Nepal Telecommunications

Authority (NTA) as per Telecommunications Act, 1997.

NTA is a telecommunications regulatory body

Growth of Internet MarketFiscal Year

License Issued

Cumulative ISP No

055/56 9 9

056/57 4 13

057/58 2 15

058/59 3 18

059/60 2 20

060/61 6 26

061/62 6 32

062/63 7 39

063/64 3 42

064/65 3 45

0

5

10

15

20

25

30

35

40

45

055/56 058/59 061/62 064/65

License Issued

Cumulative ISP No

TABLE & GRAPH: Growth of ISPs Since the Introduction of Internet Service in Nepal

Internet Market Today

Total number of Valid ISPs: 35 Total Number of VSAT Network Providers: 7 Total Number of VSAT Service Users: 110 Total Number of Internet Users:

249,400 Internet users as of August, 2007;1.0% of the population, according to ITU

Need for High Speed Internet

With the popularity and growth of internet services, the need of the customers also grew

Need of High Speed Internet emerged among different business houses and the financial organizations

Earlier Technologies Introduced By ISPs

PSTN Dial-up: slow speed ISDN Dial-up: Speed not as desired but expensive Leased Line: High Speed but very costly

Technologies Available Speed

PSTN Dial-up 56 kbps

ISDN Dial-up 64 kbps, 128 kbps

Leased Line 64 kbps up to 8192 kbps

High Speed Technologies Introduced by ISPs

Cable Internet Technology Wireless Technology ADSL Technology

(The most recent buzz in Internet Market)

High Speed TechnologiesCable Internet Technology

First introduced in Nepal By Subisu Cablenet Pvt. Ltd.

Uses the broadband coaxial cable as the medium

Requires cable modem as customer premise equipment (CPE)

Raw Capacity of 30 Mbps But available speeds: up to 256 Mbps Uses artificial Speed caps to limit speed of

their customers

High Speed TechnologiesCable Internet Technology

High Speed TechnologiesCable Internet Technology

Speed & Cost Structure by Subisu Cablenet Pvt. Ltd64 Kbps Link

S.No. Speed Data Limit (in MB) Price (in Rs)

1 64 500 2585

2 64 1000 3500

3 64 1500 4500

4 64 2000 5500

128 Kbps Link

1 128 500 3000

2 128 1000 4000

3 128 1500 5000

4 128 2000 6000

256 Kbps Link

1 256 500 4000

2 256 1000 5000

3 256 1500 6000

4 256 2000 7000

High Speed TechnologiesWireless Technology

Introduced for commercial purpose in Internet in Nepal By: Wordlink Communications Pvt. Ltd.

Uses the Motorola’s Canopy Technology to distribute the wireless technology (802.11)

High Speed TechnologiesWireless Technology

Speed and Cost StructureSpeed: Upto 120 kbps 

Wi-ZOOOM Cost 

1 Month-Rs. 3500

3 Months-Rs. 9900

6 Months-Rs. 18000

12 Months-Rs. 34000

- 20 hrs Dial-up account free for back up purpose

Installation cost: Rs. 3500.00

Subscription and Activation: Rs. 6000.00

Speed: Upto 150 kbps

Wi-ZOOOM Cost

1 Month-Rs. 4500

3 Months-Rs. 12900

6 Months-Rs. 24600

12 Months-Rs. 45000

-20 hrs Dial-up account free for back up purpose

Installation cost: Rs. 3500.00

Subscription and Activation: Rs. 6000.00

High Speed TechnologiesADSL Technology

Stands for Asymmetric Digital Subscriber Line Type of DSL Technology Asymmetric in a sense: Higher downstream rate

from 512 kbps to 6Mbps Can be implemented in existing PSTN network

with the use of ADSL Modems or Switch and the splitters

Cost-Effective solution to high speed internet service need of the people

High Speed TechnologiesADSL Technology

High Speed TechnologiesADSL Technology

Speed and Cost Structure

ADSL Speed (Kbps) Monthly rate for Internet (Rs)

3 Month Package (Rs)

Monthly port charge

(Rs)

128 Kbps 800 2400 100

256 Kbps 1400 4200 100

512 Kbps 2600 -- 100

1 Mbps 4900 -- 100

2 Mbps 9200 -- 100

ADSL Vs Cable Vs Wireless

Factor ADSL Cable Internet Wireless (802.11)

Raw Speed Maximum 13Mbps

Maximum 30Mbps

Maximum 2Mbps

Available Speed 128 Kbps, 256 Kbps

64 Kbps,128 Kbps, 256 Kbps

120 Kbps, 150 Kbps

Cost (per month) Rs 900,Rs 1500 Rs 2585, Rs 3000, Rs 4000

Rs 3500, Rs 4500

Medium PSTN copper cable

Broadband Coaxial cable

---------------

Infrastructure All over the country

Limited to major cities

Limited areas around country

Why to prefer ADSL?

Maximum districts reachable by other technologies: 20

With 72 district telephone exchanges, ADSL has larger network potential & reach

High Broadband Speed Minimized Switching and Installation cost Popularity and Growth of this technology all over

the world

Why to prefer ADSL?

Lessons For Us!!! Cost-Reduction is a technique to enter the

market with new technology New Technology accepted all over the world

generates the positive feedback New Technology grows faster if the network

base for the technology already exists in large Switching Costs are significant for shifting

customers from one base to other

Thank You

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