The Hindu : National : BSNL firms up expansion plan

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Wednesday, Jul 25, 2007
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BSNL firms up expansion plan

R.K. Radhakrishnan

CHENNAI: Bharat Sanchar Nigam Limited (BSNL), after having sorted out its problems in the award of advance purchase order for 45 million lines, has redrawn its expansion strategy based on projected needs and keeping in mind its commitment to rural connectivity.

The expansion strategy involves consultations with Ericsson on the new price offered by BSNL for the truncated order of 23 million lines; simultaneous discussions with other telecom majors — Motorola, Nokia and Nortel — to cater to immediate needs and to place new orders in the event of the BSNL price not being acceptable to Ericsson; placing a fresh tender for 75 million lines by year-end and ensuring that the additional capacity being added is 3G ready.

BSNL is now awaiting a response from Ericsson. Once the order is accepted by Ericsson, the advance purchase order will also be given to Nokia since these are the two companies short-listed for the award of the contract for 23 million lines. In the first phase, 14 million lines will be 2G and 3.5 million lines, 3G. The rest (5.5 million lines) will be decided based on the actual ground requirements for 2G or 3G. Also, BSNL has contracted ITI for a reserve capacity of 18 million lines in the West zone. Of this, 9 million would be rolled out in the near future and the package is a combination of 2G and 3G. The total capacity that would be available is 31.75 million (taking into consideration 2G/3G tender and the reserved capacity). Added to this, 4.55 million lines is under the rollout stage. Hence, the total capacity of 36.3 million lines would be the basis of BSNL’s growth over the next 15 to 18 months.

“In the unlikely event of fresh procurement not concluding in the intervening period, a possibility of increasing the quantity against the present tender still exists,” says a BSNL note. This would take care of any apprehension on the part of BSNL employees, an official said.

‘Order for 3G’

Asked how BSNL made a decision on the 3G component since the 3G policy was yet to be announced by the Centre, Union Communications and Information Technology Minister A. Raja said he was told that the order for 3G would be made only after the allocation of 3G spectrum by the Centre. Since technology was advancing fast, it was now possible to buy equipment that had both 2G and 3G capability. “The same rack shall be able to handle 3G traffic by provision of the additional cards,” a BSNL note said.

Not in a position to invest

But BSNL was not in a position to invest in any equipment for 3G as neither the specific band nor the timelines for the availability of 3G spectrum are known. Only after allocation of 3G spectrum will the enabling radio network equipment be ordered, according to BSNL. At the same time, on the directions of the Ministry, BSNL was already conducting trial for 3G services with the trial spectrum allocated to it. Private players too had access to trial spectrum conduct these trials. Asked about reports of private players already having 3G equipment, Mr. Raja said none of them had made any commercial launch of 3G services. A commercial launch could not be made since the Government was yet to decide on the band which would be allocated for the 3G services. Hence, there was no truth in the reports of private players already offering 3G services. “There is a perception that other operators have kept the radio equipment ready, which, if true is based on business risk. BSNL on the other hand, cannot commit its resources till such time a firm 3G spectrum allotment exists.”

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