Videsh Sanchar Nigam Ltd is opting for new business models including Internet Protocol based Virtual Private Network, Microprotocol Label Switching services, even as it has earmarked Rs 200 crore (Rs 2 billion) as capital expenditure in the current financial year.

"Our International Long Distance business will be under presssure with the emergence of new players, including Bharat Sanchar Nigam Ltd and Mahanagar Telecom Nigam Ltd," VSNL chairman Ratan N Tata said at the company's annual general meeting in Mumbai on Tueday.

"Going forward, new business models are necessary to sustain our revenues, especially with VSNL's monopoly ceasing to exist by 2004," he said, adding the company has also appointed Boston Consulting Group as advisors.

Elaborating on the chairman's speech, VSNL director (operations) N Srinath said the company would enter into corporate data services in a big way, where it already has a 50 per cent marketshare.

Apart from IP-VPN and MPLS services, VSNL is also planning to offer Internet Protocol Locator System and ATM services among others, which have a great potential in the country, he said.

ILD services is VSNL's biggest business line, accounting to about 82 per cent of total traffic revenue in 2002-03 and was offering its services to both BSNL and MTNL. This was under the commitments made by the Government of India at the time of VSNL's divestment to the Tata group.