Indian outsourcing sector hit by Internet disruption

BANGALORE, India (AFP) — India's vital outsourcing industry, which relies heavily on the Internet, was grappling with a major communications disruption Thursday after damage to undersea cables thousands of kilometres away in the Mediterranean.

Internet connections may take up to 15 days to return to normal, businesses said, adding that telecommunications in neighbouring Bangladesh and Sri Lanka were also affected.

"Information-technology companies, software companies and call centres that provide online services to the UK or the US East Coast are the worst affected," said Rajesh Chharia, president of the Internet Service Providers' Association of India.

"Some of them are re-routing through the Pacific as a backup, but the voice quality and speed of traffic will be highly degraded," he said, adding this solution left operators with half their normal bandwidth.

Egyptian officials said Wednesday that an undersea communications cable had been cut, while in Kuwait the government said "weather conditions and maritime traffic" had damaged two cables, affecting most of the region.

India's 11 billion dollar outsourcing industry is made up of 1,250 companies that deliver services ranging from answering customer queries to processing credit-card and mortgage applications and analysing equity markets for global clients.

The industry operates from 30 cities in India and employs 700,000 people, serving clients mainly in the US and Europe that sought to cut costs by farming out work to the country.

"Linkage to the world is our lifeline," said Raman Roy, chairman and managing director of call-centre company Quatrro, which has resorted to using backup lines via satellite.

"Our centres are not impacted because we have automatic alternative routing in place, but smaller centres would be adversely affected," Roy said, estimating that 20 percent of the industry had been cut off.

The disruption illustrates the importance of outsourcing companies having back-up systems for emergencies, whether they be electricity outages or breakdowns in captive power generation systems or Internet blackouts, Roy said.

Satyam Computer Services, India's fourth-largest software maker, experienced a deterioration in voice quality during conference calls with clients in the US because of the "uninformed outage," said Srinivasu C.P., the company's head of networking systems.

Satyam switched to backup systems, but the speed of Internet traffic had slowed, he said.

Neighbouring Bangladesh was also hit.

"The voice and data traffic bound for Europe and America is not working. It slowed down the Internet services in the country," said an official from the state-owned Bangladesh Telegraph and Telephone Board.

"Most of the ISPs and call centers have been partially affected," he said.

Another Bangladesh provider, BDCom, said it was running at a quarter of its usual capacity.

"Our operations have slowed down. All the ISPs and call centres have also experienced similar problems," said Sabbir Ahmed Suman, BDCom director and a senior member of the Bangladesh Internet Service Providers Association.

Sri Lanka also faced a drastic drop in service quality, according to Sri Lanka Telecom, the country's largest Internet service provider.

It said there was no total breakdown in services, only poor bandwidth and slow line speeds.