This planned liberalisation is broad, covering international and domestic long distance and local telephony and provides significant opportunities for both vendors and service providers of Voice over IP as most new entrants are unlikely to build traditional voice networks.

In fact the time is ripe for entry of one of the telecom majors into consumer Voice over IP. The International Long Distance calling rates, after the recent drop, are Rs.7.20/minute to the US and Europe. That's not too far from the Voice over IP rates already offered by Internet Service Providers.

On international experience, Voice over IP telephony in India can be a vehicle for enhancing teledensity as well as generate additional revenues to all players. In fact even new carriers as well as new deployments of traditional carriers like BSNL can actually keep their costs low and improve their bottom line as well.
The technology of Voice over IP has backers such as Cisco Systems that insist that the Voice Over IP industry has solved problems that once plagued the technology. But those claims tacitly assume the presence of high-quality broadband networks.

The quality of broadband is perhaps the biggest problems in India because it leaves Voice over IP providers at the mercy of other companies they can't necessarily control. A bad Internet connection can all but ruin a Voice Over IP call, which travels as millions of bits of data over the Internet or an intranet. That leaves the call susceptible to delays brought about by crowded conditions or severed lines.

The Voice over IP Telephony guidelines, announced by the Indian government, are particularly relevant to small customers. The guidelines say that only Internet service providers (ISPs) will be permitted to offer Voice over IP telephony, and after they have signed an amendment to their original licence agreement. The restrictive guidelines do not allow a PC to call up a phone within India. What's being allowed are PC to PC calls and PC to overseas telephone calls.