New Delhi: There had been a rudimentary version of the internet available in the country since 1986, when the Education and Research Network (ERNET)—a joint undertaking of the central government’s department of electronics and the United Nations Development Programme—was launched, but ERNET was only meant for the use of educational and research communities. Also, the software that would truly define the internet and make it accessible to the layman—the web browser—had not yet been invented.

We (at Videsh Sanchar Nigam Ltd, or VSNL) started planning as soon as we got the green light. We also started talking to our correspondents, like British Telecom (BT), MCI Communications Corp. and AT&T, about how they had gone about it. The building blocks were soon put together. The essential component was the connectivity to an internet service provider outside India. Simultaneously, we started setting up the hardware.

Honestly speaking, we thought we had done a reasonably good job. We started the beta testing about 45 days before the launch date, which we had set as 15 August 1995—actually the day before, so that the announcement would come on Independence Day.

Finally, the D-Day arrived and we launched the service simultaneously from five cities. I was in Calcutta, and the media coverage was extensive. In fact, some news reports termed it as a second Independence Day, after 15 August 1947! There was a lot of excitement, euphoria even. And we were happy that the public really appreciated that internet had been launched in India. But the euphoria soon turned into a nightmare.

We had grossly underestimated the demand for the service. On the other hand, there were fundamental technical flaws that we had overlooked.

The debacle

Those were the days when there used to be a beep every 3 minutes on many phone lines (to establish connection), so not every phone line was a sanitized line. If you were dialling in (to the internet) from that type of phone line, your call would get disconnected. But the department of telecommunications (DoT) said that if you want a data link or a fax line, we can knock off the 3-minute beep, but on all other lines, the beep would continue. People who dialled in would find that the connection would drop every 3 minutes. There were some robust modems where the call did not drop, but in most cases, the call would drop. This was massively irritating to the customer.

Calls were dropping, the lines were bad, and the modems were not very robust. It took us a lot to convince DoT that they had to do something about it. We demonstrated to them by using a fax machine on a non-data line—the fax machine would stay on the line, but every 3 minutes, there would be a distortion in the message.

Then people said: Okay, you’ve connected these five cities, but what about a person sitting in Ahmedabad? If he wants to access the internet, why should he be paying the subscriber trunk dialling (STD) charge, which at that time was ₹35 per minute? And if you can’t even provide a service locally, how do you expect to provide a service connecting Ahmedabad to Bombay or Pune or Madras?

We started getting really bad press. What sort of internet connectivity was this? The tone of the allegations was that this whole thing was a fraud and VSNL was scamming the people of India. I was getting complaints from the minister, from the secretary, from the chairman of the Telecom Commission. I was getting criticism from everybody and no joy from anyone.

Our tariffing too was obscene: ₹25,000 per month for a corporate account, ₹15,000 for an individual account, ₹5,000 for a shell account (only text, no visuals). Quite simply, the charges were too high, and in this case, the quality of the service we were providing in exchange was poor.

It was driving me crazy. I was wondering what we had gotten ourselves into.

The 3-minute beep problem was solved when DoT agreed that the lines they would give VSNL would not have the beep. The next issue was about providing pan-India access. So, DoT gave us a special five-digit number. Anyone from anywhere could dial that number and log on to the internet in one of the five cities without having to pay STD charges. DoT decided that it was more cost-effective to lose some STD traffic (and revenue) than to put up nodes in dozens of cities, each of which would cost ₹20-25 lakh, when there might not be that much traffic.

But the worst nightmare was that the service was pathetic. The modem would blink, but nothing would happen on the line.

View Full Image Miheer Mafatlal in 1994 got three beta accounts for Apple’s eWorld service (Photo: Napol Stock Image)

Race to find a fix

I called my staff and said that we had to find a solution. I gathered my team and said: “I want to have a press conference. I want to talk to the public. But first, can you assure me that we can put the systems in place and make things all right?" We discussed the problem down to its roots. What emerged was that we had essentially taken on the venture as an R&D project and hadn’t designed it as a commercial venture. In short, the whole basis of our thinking had to change.

We called the press conference and we had a full house; some 60-70 journalists turned up. They were all very aggressive. The questioning went on and on. What sort of lousy service were we providing? What had we been thinking? My directors and I sat through it all.

Finally, I said: “Gentlemen, I have called this press conference because I know you are annoyed and you have every reason to be annoyed. You can go on like this, but we need to have a conversation, and I want to have an outcome out of this, so that we can get going."

Someone said, “So what do you have to say?"

Others said, “Let him speak, let him speak."

When there was silence, I said, “I goofed up. I goofed up big time. Our market intelligence was wrong, which meant that our sizing of the requirement was wrong. And there were technical problems that we never anticipated would turn out to be that serious. It was a bit of an amateurish venture. But the reasons I wanted to speak to you are, one, that I goofed up, and two, we have the game plan to build the system into a world-class system. We have carried out studies as to what is required, and I need 10 weeks from you. The plan is going to cost me ₹10-15 crore, but that’s not your problem. I can assure you that at the end of 10 weeks, possibly before that, you will have a system that India will be proud of."

One reporter stood up and said, “Should I print: CMD VSNL says ‘I goofed up’?"

I said, “I have made a statement in public in front of all of you, I can’t deny that."

Another gentleman said, “But what about all your other executives here?"

I said, “The buck stops with me. We have the solutions. But we need 10 weeks. My only request to you is that you don’t write anything for these 10 weeks. And I assure you that you’ll have a world-class system at the end of that period."

There were murmurs—"You’re trying to muzzle us."

“I’m not trying to muzzle you," I said. “I am only requesting you. And I am admitting my mistake in a public forum. So now let’s have tea together."

During the tea break, a few senior journalists came up to me. They said, “Sir, you made a very bold statement."

“What option did I have?" I replied.

Next morning, only The Times of India printed: CMD VSNL says: “I goofed up" with a photograph. I got a call from the telecom minister, Sukh Ram. He said, “You made a mistake."

“Sir, you have to answer questions in Parliament about poor service," I replied. “I have strengthened your hand."

View Full Image The cover of 'Telecom Man', by Brijendra K. Syngal with Sandipan Deb

The porn question

The other problem which we faced during this time was that of pornography. I got calls from the minister and from secretaries: “What is this ashleelta (obscenity) that you have brought into the country?"

I had to tell them: “Sir, my job is to provide connectivity. It is not my responsibility what an individual uses that connectivity for. If 2-3% of people use that connectivity to watch pornography, I am not interested. I am interested in serving the 97% of the population who are interested in getting linkage to global knowledge."

In terms of size, we had provided one phone line for 30 consumers. So, if Person A got on to that line, Person B would have to twiddle his thumbs; he could get nowhere. Statistically, this averaging was wrong. So, our initial sizing was way off the mark. We then studied systems worldwide to find out what benchmarks to use. We found that BT and AT&T started off with a ratio of 1:10. And in certain places, they were even doing 1:5. We immediately decided to go to a 1:10 ratio, and as the consumer base increased, we would keep raising these numbers.

Then we added servers. We created a bank of servers, so there would always be backup. If a server failed, another would take over automatically. We decided that it was better to spend some more money than have a system crash every third day. As long as I was in VSNL, we never had a crash—the service was never interrupted.

I used to get up in the middle of the night to see after how many rings did I get a modem handshake. Then, we found there was congestion in connectivity. Initially, we were using 128 Kbps lines, but downloads were very slow. So we started moving towards 2 Mbps lines on fibre, not copper.

It was a complete revamp of the system. We had maybe envisaged a consumer base of 5,000-10,000 in each of the five cities. We now focused on immediately increasing that by a factor of five or six. We wanted to go from a scarcity situation to a mode of plenty.

I also knew that VSNL was poor at marketing, so I decided to get franchisees to sell the internet services. This reduced the paperwork at our end. In the bargain, we lost 10-15% from every internet connection we sold, but it was worth it.

We brought down the tariffs by half and more. My sunk-in costs remained the same, but if we could ramp-up volumes quickly, VSNL’s recovery of sunk-in costs would be much quicker. We also got rid of the shell account, because people were able to crack it and convert a ₹5,000 subscription into a ₹15,000 one. And as volumes rose, we kept reducing tariffs. We also gave a carry-forward—if you haven’t used up your quota, you can carry it forward. Thus, we took a large number of customer-friendly initiatives. There were a number of innovations from a common sense-driven point of view.

It took us about eight weeks to get the new system up and running, and stable. Our own staff was encouraged to use the internet system as much as possible to get a feel of what was going on. We recruited youngsters who were tech-savvy and curious.

It was a very interesting learning curve. In fact, a Chinese vice minister came to us to learn how we had gone about providing connectivity. He wanted to pick our brains.

The internet brought the third Industrial Revolution—the first was wrought by steam, the second by electricity—and India has gained immeasurably from it. I feel fortunate to have been in a position to have spearheaded its coming to our country.

The world shrank the day the internet entered our lives. It surely was a second Independence Day.

Today, when I sit back in my rocking chair, at times I mull over how the internet disrupted our lives and society to become the fourth necessity after roti, kapda and makaan. And I feel delighted when my seven-year-old grandson talks about slow internet speed and asks for my Wi-Fi password or hotspot in the car.

Brijendra K. Syngal is former chairman and managing director of erstwhile Videsh Sanchar Nigam Ltd. Sandipan Deb is founder-editor of Open and Swarajya magazines.

Excerpted with permission from Westland.

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