Proliferation of ISPs and growth in Internet
Users and Domain Registration

Vimal Kumar Varun
Department of Scientific & Industrial Research, New Delhi-110016

Internet: URL:


Describes the growth of Internet as well as WWW in the World in general and India in particular. In India, from just 359 hosts in January 1995, it has jumped to 23,445 hosts in January 2000. With the introduction of new ISP Policy by the Government of India in November 1998, a large number of ISPs have already entered the field and more are likely to join. According to a NASSCOM Survey that covered India as a whole, there were 1.04 million Internet connections used by 3.70 million users in June 2000. The user base is estimated to rise to 18 million with 8 million Internet connections by March 2003. The survey further reveals that the Internet and Electronic Commerce industries employ over 82 thousand people today which is likely to rise over 5 lakhs by March 2003. According to age group, the category of Internet Users are as follows: 8-24 year age group — 49%, 25-39 year age group — 28% and the test — 23%. Of the users, 77% are males. Charges for Internet access are coming down sharply. Addresses for important URLs relevant to topic ar also given.

The pace with which Internet is growing the Worldover is well known. Till sometime back, it has been growing by about 8-10% per month, now is doubling the rate in less than six months. Among all these, the WWW an application system which is the most powerful and easier to use, has enhanced its value as a communication medium.

Internet Usage (%)
ftp 42 26
email 17 17
elogin 16 24
www 24 33

* interactive application, games, etc.

In fact, the WWW has grown substantially faster than Internet, as measured in terms of number of hosts. While internationally the number of hosts increased from 4.8 million in January 1995 to 72.3 million in January 2000, in India it has risen from 359 hosts to 23,445 hosts in the corresponding period. The detailed statistics on number of hosts is available at

There are two key components to the WWW web server and web browser. Web servers host web documents written in HTML (Hyper Text Markup Language) and transmit these over Internet using HTTP (Hyper Text Transmission Protocol), which operates on TCP/IP. Web browsers are user interface software packages, which receive and display web pages from the servers. Netscape, Internet Explorer (included in Microsoft Windows 9x) are two very popular web browsers. In addition to HTTP, WWW supports other access tools like E-mail, ftp, gopher, and telnet making it an all-in-one user interface.

Generally, the information available on Internet is very wide ranging and one should be careful for the Net information, which depends mostly on the products or services of each business type i.e., supplier, distributor or retailer. Internet offers powerful means for any business in terms of:

Any business company can utilize the Net for a variety of services it offers widely, such as widening its client base, development of new market for its products, shopping of goods and services, advertise the products & services, analyze new product, market research, etc. This helps companies to manage their business more efficiently and effectively. It is estimated that the Internet generated revenue has increased from 0.436 B US$ in 1995 to 180 B US$ in 1999 and it is expected to reach 1234 B US$ in 2002. The details may be seen at total_revenue_generated_2002.html.

The total online advertising revenue has also increased from 0.10 B US$ in 1995 to 3.0 B US$ in 1999 and it is projected to 7.7 B US$ in 2002. The global online advertising revenue will be 15 B US$ in 2003. The details may be seen at html. The online advertising revenue in 2003 for Asia will be 1.25 B US$ as compared to 10.5 B US$ (USA) and 2.8 B US$ (Europe). The details may be seen at

The estimated worldwide Internet users as of July 2000 are over 359.8 million, out of which Asia/Pacific accounts for 89.43 million. The details may be seen at index.html. It is further estimated by NASSCOM that India has only 800,000 users in May 1999, which is 0.08% of its total population.

The Internet facility in India is not new. Earlier, it was provided by ERNET (Education Research Network) and NIC (National Informatics Centre), but it has been limited to those associated with educational institutes, R&D organisations or government departments. In August 1995, Videsh Sanchar Nigam Limited (VSNL), a public sector undertaking and the international telecom carrier, launched the first public Internet service in six major cities, which has today expanded to over 42 cities.

One of the major factors that has limited the expansion of Internet in the country is poor infrastructure, with problems such as the non-availability of telephone lines and an overloading of telephone circuits that were designed for voice communication.

After a delay of nearly 3 years, and mired in litigation and controversy for over a year, the long-awaited revolutionary new ISP Policy was announced on November 6, 1998. The ISP policy permits unlimited number of Internet players with no license fee for the first five years. Thus, the stage was set for the rapid growth of Internet in a completely deregulated operating environment. The expansion of Internet services places three-fold demand the need for more access lines, national backbone as well as international bandwidth.

As on date only about 75 ISPs (out of over 350 licences) have actually launched their services. Others seem to be re-thinking and reworking their plans. Many ISP dreams may well be still-born. Out of the total of over 350 ISP licences issued in India, a staggering 60 per cent are in the C category. While out of the 75 ISPs who have gone operational, barely 15 are C category players.

Internet Service Providers
Category Type of ISP
A National
B State
C City

Today apart from government owned ISPs e.g., ERNET, NIC, VSNL, STPIs, MTNL, there are a large number of private ISPs such as Satyam Infoway, Bharti BT Internet, Dishnet DSL, Magna Corp India,, Wilnet Online and Avadh Internet are operating as ISPs in the country. More will be added to this list very soon.

The problems with today's Internet are Increased usage, Bandwidth and Management. As nobody owns, rather every body owns Internet, there is nobody responsible for these problems. Thus, it is impossible to determine where the bottlenecks exist and it is difficult to address the throughput problems. Commercial providers are reluctant to share information because of concerns for business advantages.

Because of competitive market and acute financial shortage, ISPs would need to slog to attain a critical mass to survive. Gobbling smaller players is perhaps the easiest way of doing that. At this stage, a lot of takeovers are expected mostly of the city-centric ISPs. While the valuations are getting realistic, smaller players are also getting desperate, willing to sell out.

Details are available at An article on `Mass-ISP Attraction' has been published in The Economic Times under Corporate Dossier dated July 21-26, 2000, written by Malini Goyal (  

NASSCOM has recently carried out an Internet and e-commerce survey in over 68 cities and towns across the country, which accounts for 92% of Internet users in India. The details of the survey are available at

According to the said survey there are 1.04 million Internet connections used by 3.70 million users as on June 2000, which accounts for a mere 0.37% of the population. Globally, 36% of world's population access the Internet as on date.

It is further estimated that the user base will rise to 18 million (8 million Internet connections) by March 2003 and 23 million (11 million Internet connections) by December 2003. This growth will be accounted for accessing the Internet by mobile phone and Cable TV.

The Government decisions to enhance the bandwidth and liberalize its telecommunication policy will likely to further increase the Internet connectivity in India.

NASSCOM also predicts a similar growth in job creation as the Net is expected to drive growth in e-commerce. The survey reveals that the Internet and e-commerce industry in India today employs over 82,000 people and by March 2003, this number is likely to increase to over 500,000.

The survey also provides demographics of Internet users in India. Heaviest users are from the 18-24 year age group (49%) followed by 25-39 age group (28%). Out of these, 77% are males. However, the survey noted that Internet access amongst women too witnessed a 5% increase over last year.

India has witnessed a significant growth in Internet usage not only in terms of Internet connections and users but also in web sites. Each web site has a unique domain name and can be licensed only to one entity in the world. This explains the explosive growth in registration of new domain names with existing companies rushing to register their organization's name so that it is not licensed to someone else.

After a price war in the Internet access charges, the market is now shifting to provide domain name registration at lowest prices. Internationally, the domain name registration companies are charging $70 for two years ($35 per year). Whereas, the domain registration charges in India are between Rs. 600/- and Rs. 1575/-.

Net4Domains (, part of the Net4India (Category `A' ISP) has slashed the price for domain registrations to Rs. 399.00 per year from Rs. 650.00. The domain registration for two years at a cost of Rs. 750.00 with Net4Domains provides 10 POP email ID's at (Unlimited storage space & unlimited Aliasing) + 1 month Unlimited Internet Access in Mumbai, Delhi, Hyderabad, Bangalore, Poona & Chennai. The details are available at

Cost of Domain Registation at Net4Domains
Year Cost Year Cost
1 399 6 1950
2 750 7 2275
3 1125 8 2600
4 1500 9 2925
5 1875 10 3250

Net4Domains will make money from value-added services like web hosting and service co-location. Net4Domains has so far registered 42,000 domain names since March 16, 2000 and has set a target of 2.5 lakh by the end of year. This new scheme is targeted to the individual as well as the SME segment.

DelhiNet (, a Web services company and a Gold Premier Partner of Network Solutions, launched a limited time offer of $ 25 (approx. Rs. 1125/-) per year to register a domain name. In case, one books more than 10 domains within a month, then domains will be available at $22 (approx. Rs. 990/-) per year. Other terms and conditions may be seen at For more information may be contacted

AllIndiaNet ( is the Gold Partner and representative in India of Network Solutions, the world's top domain name registrar handling more than 70% of the world's domain name registration. One can register a domain name at 35$ for 2 years. For more information, point your browser to

To overcome the problems already discussed above, especially Internet overload problem, VBNS (Very high speed Backbone Network Service) and Internet 2 projects are being developed. The VBNS, proposed by NSF (National Science Foundation) will have a shared backbone of OC12 connections (peak speed of 622 Mbps), managed by MCI. The mission of Internet 2 is to facilitate and coordinate the development, deployment, operation and technology transfer of the advanced, network-based applications and network services in research and higher education and accelerate the availability of new services and applications on the Internet.


Though we are yet to reap all the potentialities of well-facilitated medium of access and communication on Internet, the development in last 30 years worldwide, have brought about paradigmatic changes as follows:

All these developments in turn would affect international traffic control, trade and e-economic dominance and the evolution of a knowledge-based global society.


A Brief History of the Internet

Future of Internet

The Internet Index

Internet Domain Survey

Internet Statistics

The Lists (worldwide listing, search by Name/Domain)

Internet Trends

Internet Surveys /comparisons/index.html


Internet 2

Attention ITT Readers

The Internet Edition of ITT, available at, comes out much before the publication of its print version. You may also browse the back issues from 1995 onwards.

Information Today & Tomorrow, Vol. 19, No. 3, September 2000, p.12-p.15