INDIAN CARRIER ENTERS U.S.

This week, Indian international voice and data carrier Data Access will launch wholesale long-distance service in the U.S., kicking off the first phase of an expansion plan the company hopes will transform it into a major global trafficker of voice minutes.

Data Access is launching U.S. operations on May 27, having completed the installation of its first U.S. switch in New York five months after it obtained its facilities-based 214 carrier license. The Super POP switching center hooks into Data Access' global voice-over-IP network, which links 230 countries through nine network operation centers (NOCs).

Most of Data Access' efforts will concentrate on pushing minutes between South Asia and the U.S. and the U.K. The company also plans to extend its carrier licenses all over South and Southeast Asia and bring in other countries with large Indian populations, such as the United Arab Emirates, into its core network. Eventually, Data Access plans to discard its South Asian focus and become a global long-distance and data carrier, said Siddhartha Ray, CEO of Data Access India and chairman of the global holding company.

The choice to expand to the U.S. was fairly obvious, Ray said. More than 60% of all Indian international long-distance traffic terminates here, and the U.S. makes the perfect jumping-off point for Latin American markets. Breaking into the North American market won't be easy, though. The U.S. has more than 2800 licensed long-distance carriers, but Ray said his company has the upper hand because of India's cheaper operational costs — an advantage other international carriers cannot capitalize on because of India's still strictly regulated telecom industry.

“The [New York] switch is managed completely from India,” Ray said. “We're operating a U.S. long-distance network from New Delhi. The operational savings are quite significant. It allows us to severely undercut our competitors' prices.”

Ray said it would take an average of 50 to 60 mostly unionized workers — all at high salary levels — to operate and manage its New York NOC, but it only takes 10 people earning comparably lower salaries to run the center's operations from India. Through interconnect agreements with international voice carrier ITXC and points of presence in Madras and Bombay, Data Access keeps all the calls terminating in the U.S. and in India on network, allowing it to offer wholesale rates to U.S. carriers as low as 14¢ per minute, a price Ray said would far undercut any global carrier.

However, the company's greatest asset may be its focus, said Norm Bogan, director of communications infrastructure and services for In-Stat/MDR. “This is a very competitive market, but Data Access is being very selective where it goes,” he said. “As the RBOCs get into the long-distance market, they'll be looking for wholesale partners for international long-distance. Data-Access' cost advantage could be very attractive to them.”