Bharti bags BSNL bandwidth deal

Bharti Tele-Ventures has outbid the Tatas-owned Videsh Sanchar Nigam Ltd (VSNL) to bag a three-year deal for providing Bharat Sanchar Nigam Ltd (BSNL) with international bandwidth for its Internet operations.

BSNL executives refused to reveal the rates quoted by VSNL and Reliance, who were also in the fray for the contract, but added that Bharti Tele-Ventures had emerged as the lowest bidder at Rs 3.6 crore per 2x155 MB capacity a year.

At present, VSNL is the sole supplier of international bandwidth for BSNL's Internet applications. The contract comes as another blow to VSNL, which earlier in the year had been edged out by Reliance Infocomm to carry BSNL's international long distance (ILD) traffic in six of the 11 sectors in the country.

Besides, in July, 2005, BSNL had also decided to end its relationship with VSNL for carrying its ILD traffic and floated a global multi-million-dollar tender to set up its own network.

According to BSNL executives, the deal with Bharti Tele-Ventures would be renewed on a yearly basis, for the next three years, by which time the PSU is expected to be ready with its own international submarine cables for both its ILD and Internet traffic.

The PSU, which currently has over 200,000 broadband subscribers, plans to increase its subscriber base to 1 million by March 2006.

It will, therefore, require additional international bandwidth capacity to carry its Internet traffic over the coming months.

BSNL executives said the company's 20 gigabyte undersea cable to Sri Lanka was expected to be operational in the second quarter of 2006, and would cater for its international bandwidth requirements in addition to carrying its ILD calls.

On its global tender for international bandwidth through optic fibre cable and satellite connectivity, BSNL executives said seven players had been shortlisted, including France Telecom, Telecom Italia, Flag Telecom, VSNL and Bharti Tele-Ventures. This is one of biggest global contracts in the ILD segment.

"We will take a decision on the issue soon. We will place a two-year deal with the successful bidder," added a senior BSNL executive.

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Winning bet

Bharti was the lowest bidder at Rs 3.6 crore per 2x155 MB capacity a year

Deal to be renewed on a yearly basis for the next three years

VSNL and Reliance were also in the fray