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Infrastructure: Blooming in July

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VoicenData Bureau
New Update

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.

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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.

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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.

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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.

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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

Released in July

Bharti Airtel

  • Ericsson awarded an

    estimated $2 bn expansion contract for GSM/EDGE network and also

    capacity management for 15 circles. The contract will also take care

    of pre-paid platform for innovative prepaid services across all 23

    circles

  • Huawei will bag

    managed services contract for Sri Lanka operations worth $110 mn plus

    for 2G and 3G services

  • Nokia Siemens

    Networks contract worth $900 mn for expansion across Airtel's

    mobile, fixed and Intelligent Network platforms

BSNL

  • Ericsson issued APO

    worth $1.24 bn

  • ITI awarded NGN

    contract for 14 additional nodes worth $24.3 mn

Reliance Communications

  • Alcatel-Lucent

    awarded an IP-based next-generation CDMA network contract valued at

    more than $400 mn

  • Huawei awarded an

    IP-based next-generation CDMA network contract valued at more than

    $200 mn

  • ZTE is also in final

    stages to finalize a $125 mn deal for CDMA and GSM wireless

    infrastructure

Spice Communications

  • ZTE awarded GSM

    wireless infrastructure contract worth $45 mn

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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.

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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.

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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

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