It's make or break year for integrated operators in India. The
one who succeeds will be the winners in the phase II of expansion, since the
focus is on expanding services to newer geographies. The focus is also on
expanding rural coverage as India has a large rural population. All this will
not only help in increasing mobile coverage from about 60% to close to 90% by
the end of March 2008, it will also help in achieving the 500 mn lines target by
2010.
The integrated operators have massive expansion plans. Bharti
Airtel is planning to expand from 4,676 census towns and over 200,000 non-census
towns and villages to cover all census towns in FY '08. Plans are also on for
70% coverage by the end of 2008.
BSNL has massive expansion plans. It plans to increase mobile
coverage in 1,000 more cities and also a large number of villages. BSNL already
has a good state and national highway coverage and this will further improve
with a 31.6 mn line addition.
Reliance Communications is planning to expand from 10,000 towns
and 300,000 villages to 23,000 towns and 600,000 villages. The company is also
planning to cover every single habitation with a population of over 1,000 by the
end of 2008. And, by the end of the year, Reliance Communications plans to cover
85% of the population. Spice has also opted for wireless expansion in the
Karnataka and Punjab circles.
July 2007 was a landmark month for Indian telecom with Indian
service providers announcing deals worth Rs 20,680 crore ($5.04 bn) in the
mobile and fixed line space. Majority of the deals are from wireless.
The Operators
Bharti Airtel, the number one operator has reached a base of 42.7 mn mobile
susbcribers and plans to reach 100 mn plus by 2010. Having already established a
base of 39,000 BTS, the company plans to add around 30,000 base stations this
fiscal.
Bharti also plans to increase its NLD network by another 20,000—25,000
km. All this will result in a capex investment of around $3.5 bn in FY '08.
Bharti Airtel has recently awarded Ericsson an estimated $2 bn
expansion contract, including expansion of its GSM/EDGE network and also
capacity management for 15 circles. Under the two-year supply and services
contract, Ericsson will design, plan, deploy, optimize and manage Bharti Airtel's
GSM network and also take care of pre-paid platform for innovative prepaid
services across all twenty-circle circles. In addition, Ericsson will also
deliver pan-India integrated device management solutions for mobile customers.
The core network is based on Ericsson's layered architecture
paving way for an all-IP network. It includes a common 2G/3G core based on
mobile softswitch. Ericsson will deploy the Flamingo series radio base station
and Expander solution will be deployed for expansion in rural markets.
Apart from the Ericsson deal, Bharti Airtel has also signed an
MoU with Nokia Siemens Network worth $900 mn for expansion across Airtel's
mobile, fixed and Intelligent Network platforms. In the first of its kind multi
platform network contract, Nokia Siemens Networks will expand Airtel's GSM
network in eight circles. The contract will also deploy 1.8 mn NGN ports for NLD
and ILD networks and will increase international calling card prepaid service
capacity by 4.5 mn. The GSM and NGN expansions are planned for two years whereas
international calling cards expansion is for three years.
The two year GSM expansion will cover the eight existing circles
of Mumbai, Maharashtra, Goa, Gujarat, Madhya Pradesh, Chattisgarh, Bihar and
Jharkhand, Orissa, and West Bengal, where Nokia Siemens Networks already provide
equipment and managed services. Nokia Siemens Networks will deploy the latest
state of the art GSM equipment such as Flexi Edge and Ultrasite BTS, BSC3i,
3GPP-based mobile softswitching solutions including 3G capable MSC servers and
media gateways, and transmission network including PDH and SDH.
Orders |
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Bharti Airtel |
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BSNL |
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Reliance Communications |
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Spice Communications |
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On the NGN front, Nokia Siemens Networks will deploy complete IP
trunking solutions with SURPASS hiE 9200 softswitches, SURPASS hiG 1200 media
gateways and SURPASS hiR 200 media servers. The international calling cards
services expansion will see Bharti quadruple its capacity and adequately address
its calling card business expansion to tap more international markets.
Having expanded services in British Isles and Seychelles, the
company is planning to expand its services in Sri Lanka where it has got a
license to offer 2G and 3G services. The company plans to launch services in Sri
Lanka by January/February '08, and is planning to sign up with Huawei for a
managed services contract. The managed services contract is similar to Ericsson
and Nokia Siemens Networks contract signed for pan India operations. The value
of the contract is expected to be $110 mn plus.
Bharti Airtel is also planning managed services contract for its
fixed line network on similar lines to that of mobile networks done three years
ago. For managed services, the company is in active discussion with Alcatel,
Ericsson and Nokia Siemens Networks.
L-R: Manoj Kohli, CEO, Bharti Airtel and Simon Beresford-Wylie, CEO, Nokia Siemens Networks signing an MoU worth $900 mn |
BSNL, the incumbent operator, has a subscriber base of 29 mn
mobiles, and has massive expansion plans. Initially, the plan was to deploy 63.5
mn lines of which 45.5 mn lines were through tender whereas 18 mn lines were for
the Western region, to be implemented by ITI along with Alcatel. But with the
change in guard at the Ministry of Communications, there was a review of the
tender and a three member committee was formed to look into different aspects of
the tender process. Finally, after a discussion by the three member committee
and the BSNL board, the size of the tender has been reduced by half-to 22.75
mn lines. And it seems even the ITI order size will get reduced from 18 mn lines
to 8.9 mn lines.
Out of 22.75 mn lines, 6.5 mn lines will be 3G which will be
awarded once the 3G policy is being announced. So, Ericsson will get 13.2 mn
lines whereas Nokia will get 9.55 mn lines. And at the rate of Rs 3,854 per line
the cost of the total deal size comes to around Rs 8,768 crore.
Ericsson, the L1 bidder has been issued APO (advanced purchase
order) and has been given 14 days to accept or reject the offer. In case it is
accepted or rejected it is then given to the L2 bidder for a similar exercise.
Recently, BSNL has also selected the Tekelec EAGLE 5 Integrated
Signaling System solution to support transition to next-generation networks
through ITI. BSNL is extending an existing relationship with Tekelec for
traditional signaling system 7 (SS7) solutions initiated in 2005. The project
will expand the existing deployment of 10 EAGLE 5 ISS nodes and adds an
additional 14 nodes, which is one of Tekelec's largest single shipments of
EAGLE 5 ISS nodes.
Tekelec solution will provide BSNL with a separate signaling
plane that utilizes IP-based connectivity and centralized control and routing to
connect its varied, highly dispersed signaling end-points. The Tekelec solution
gives BSNL a homogeneous SS7 core network-independent of the service or
technology used in the network-while providing a future-proof platform that
supports applications such as number portability, integrated monitoring and
routing optimization for home local registers (HLRs) and voicemail servers. The
contract covers both wireless and wireline and will cover 20% of the existing
capacity. The value of the contract is worth Rs 100 crore.
Reliance Communications has a mobile base of 33 mn. The company
has taken 4 years to acquire the first 30 mn customers and plans are to add
another 20 mn in a year's time. On the optic fiber network, the company has
100,000 km and plans for another 130,000 km by end of 2008. Till date, the
company has invested around Rs 32,000 crore and plans are to invest over Rs
16,000 crore in FY '08. In terms of tower, the company has added around 13,849
towers till date and plans are to build 23,000 new towers in 2008.
If version 1.0 of the Indian telecom story was about
affordability then version 2.0 will be about reach says Anil Ambani, chairman,
Reliance Communications.
Reliance Communications has a mobile base of 33 mn. The company has taken 4 years to acquire the first 30 mn customers and plans are to add another 20 mn in a year's time |
The company has recently awarded Alcatel-Lucent an IP-based
next-generation CDMA network contract for eleven circles valued at more than
$400 mn. The contract will enable Reliance Communications to expand its wireless
network to more than 20,000 towns and 600,000 villages. The project is valid for
a year. The project includes installation and commissioning of IP-ready 3G core
and 3G ready base stations. As per contract, Alcatel-Lucent will upgrade
Reliance's CDMA network with additional mobile switching centers and base
stations. Alcatel-Lucent will also provide a comprehensive suite of network
integration services, including network optimization, system support and general
project management.
Reliance Communications has also awarded a network expansion
contract worth $200 mn to Huawei Technologies for seven circles. Under the
agreement, Huawei will supply and provide services for CDMA base stations,
including BSC and switches, and help create first class all-IP next generation
network infrastructure. The project is for seven circles and includes
installation and commissioning of IP-ready 3G core and 3G ready base stations.
The contract for Huawei is valid for one year.
Reliance is also in the final stages to finalize a $125 mn deal
for CDMA and GSM infrastructure along with ZTE. The project is for commissioning
IP-ready 3G core and 3G ready base stations.
Spice Communications has also given expansion orders worth Rs
185 crore to ZTE for GSM infrastructure in Karnataka and Punjab circles.
Conclusion
The other operators do not want to be left behind and also move along with
the leaders. Hutchison Essar has annouced an RFP for 20,000 BTS which has not
been finalized. The company is also planing for its own NLD network, and plans
are also on for OFC deployment of 12,000-14,000 km of OFC backbone. Aircel also
has very ambitious plans and has announced an RFP of 25,000 BTS. The company has
only finalized Nokia for Kolkata and is in talks with Ericsson, Huawei, Nokia
Siemens and ZTE. Even Tata Teleservices has to focus on network expansion in a
big way in order to keep pace with their counterparts. So, it's raining
dollars for vendors.
Pravin Prashant
pravinp@cybermedia.co.in