The Tata group plans to buy out a string of Internet Service Providers (ISPs). The move seems to be aimed at emerging as the largest business to business e-commerce platform via a new venture ISP India. Besides, the group also plans to pick up stake in telecom ventures. The competition in the ISP business is hotting up with players like MTNL and VSNL engaged in a price war. Satyam Infoway, the first private ISP is focusing on improving the content it offers while players such as Rolta have tied up with Rediff for offering content. Major players such as Zee and Wipro have plans to enter the business mainly to complement their existing businesses.
Despite the competition, India offers a very good potential for ISP providers. And the Tatas with their brand name and expected service standards have a very good chance of emerging market leaders.
What the Tata group is banking on is the fact that in a tough scenario some players may want to sell out and it is quite possible that Tatas get an entry at a far lower price. Obviously the company wants to become an enabler for business to business transactions and an ISP is only a vehicle for this foray.
For starters, Tata Consultancy Services (TCS) could provide the software for business to business transactions. However, in the future it is possible that the venture could source software from the other software manufacturers.
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