Bad times catch up with BSNL

At a time when leading private telecom players are adding 5-6 million new subscribers every month, state-owned BSNL has been recording a little over one million additions across the country — making it one of the worst performers in the industry.

This has triggered an emergency-like situation at the corporation and BSNL is working out a plan to expand the capacity in its existing network, pending the fructification of its tender to increase network capacity by over 23 million lines which has been mired in one controversy after another.

Existing capacity is just little over one million connections for the entire nation, other than Delhi and Mumbai where MTNL offers services, highly placed sources said, adding that the corporation will talk to existing vendors for add-on capacity.

Amid all this, BSNL has stopped all advertisements for its various schemes as the company may not have capacity to meet the demand.

“Even if we add eight to 10 million new lines (to the network) we shall be able to offer new connections only for the next few months and meanwhile negotiations are on with the lowest bidder Ericsson to place the order for 60 per cent of 45.5 million tender which was later reduced by 50 per cent,” BSNL officials said.

For the add-on capacity, BSNL would be talking to the existing vendors including Ericsson, Nokia and Motorola.
Asked about investment for the add-on capacity, officials said it would be less as compared to new capacity as it did not include any infrastructure. Only transmitters and receivers have to be installed and the estimated investment would be about Rs 2,000 crore.

BSNL has already been shunted to fourth place after Hutch-Essar (now Vodafone-Essar) replaced it from the third position after the PSU failed to provide new connections.

Nokia and Ericsson are the vendors for the North and Eastern regions for the existing networks, while Alcatel is in West and Motorola is in Southern region.

Asked how much time it would take for ‘add-on’ capacity, officials said: “We have started talking to the vendors and this can be done in 2-3 months and we are anticipating 8-10 million lines capacity by this method.”

As regards the new tender, BSNL has placed the Advanced Purchase Order (APO) with the lowest bidder Ericsson and talks are on for placing the final order while with Nokia, the second lowest bidder, would get order only after finalisation of price with Ericsson.

Ericsson would be getting 60 per cent of the order of the reduced tender of 23.5 million lines while Nokia would
get the remaining.

“We have to put the past behind us and look forward. We are hoping to put things in place and we would emerge the strongest player once again and very soon,” a BSNL official said.