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Calcutta, Feb. 20: Bharat Sanchar Nigam Limited (BSNL) plans to launch IP phone services during the first quarter of the next financial year. IP phones facilitate real-time, two-way conversation over the Internet, bypassing circuit switched network.

The telecom major has already identified five circles ? Calcutta, Chandigarh, Maharashtra, Rajasthan and Uttar Pradesh (East) ? for offering the services.

IP telephony, estimated to grow at a CAGR of 119 per cent to touch Rs 13,000 crore by the year-end, is expected to be the next big revenue generator in the fixed-phone segment.

IP telephony clubs data into ?packets?, which is then sent on the Internet. Each packet is encoded with an address and reaches its destination independently. The packets regroup at the destination and are converted into regular voice over telephone lines.

In circuit-switches, the connection is set up at the start of the call and all resources are allocated permanently to the user till the end. No other subscriber can share them. In a packet-switch scenario, the connection exists only for the duration of data transmission. Once a packet is sent, resources are free for other packets. This lowers cost and optimises line usage for voice and data transmission.

The US-based In-Stat says that more than 30 per cent of businesses world-wide are expected to adopt IP telephony this year.

The five circles have been asked to procure equipment and other infrastructure material required to achieve the target. The voice market in India, including international and national long distance, is estimated to be worth around Rs 33,000 crore. Of this, IP telephony is likely to grab a share of 2 to 3 per cent.

BSNL sources said, ?Of a total of 42 lakh fixed-lines next fiscal, each of the five circles has been set a target of 20,000 IP phones.?

Calcutta Telephones chief general manager S. P. Chakravarty said, ?BSNL already has an IP VPN network in place that covers Calcutta, Bangalore, Hyderabad and Chennai. The company is now working on developing the specifications for a trunk IP network that will initially have a presence in 22 cities.?