BSNL mulling outsourcing 3G services

5 Jul 2010

State-owned Indian mobile network operator Bharat Sanchar Nigam Ltd (BNSL) is planning to outsource its 3G services, the Business Standard reports. The operator is currently working on the details of a franchisee agreement and, according to the cellco’s chairman and managing director Kuldeep Goyal, expressions of interest could be invited by as soon as the end of this month. Any company inking a franchisee deal with BSNL would likely be required to manage customer acquisition, marketing and sales across the country. BSNL believes such a move would allow it to cut the investment needed to roll out its third-generation network at a time when it is struggling financially; the telco is expected to report losses for the 2010/11 financial year after paying out arrears on wages.

BSNL is seeking to grab a significant chunk of the 3G market before the first quarter of 2011, by which date many of those private operators that won third generation spectrum in May 2010 are expected to have launched competing services. Commenting on the telco’s 3G aspirations, Goyal noted: ‘We expect 5% of our total user base to come from 3G. This figure might go up to 10%-15% of our mobile customer base in the coming time.’ Despite having a first-mover advantage –both BSNL and sister company Mahanagar Telephone Nigam Ltd (MTNL) were awarded 3G frequencies in July 2008 – both operators have yet to register significant uptake. BSNL has now introduced 3G services in some 450 cities across the country, and expected to boost this number to 750 by the end of 2010, at which date it hopes to have around four million third generation customers.