The Hindu Business Line : Bharti, VSNL in Rs 500-cr pact to share STD network

THE Bharti group on Sunday finalised a Rs 500-crore deal to share its national long-distance (STD) network with VSNL in a first-of-its-kind accord between two top telecom service providers in a bid to optimise capacities in the NLD segment.

"This is the first such agreement between two leading players and heralds a new era in Indian telecom. As part of the 15-year agreement, VSNL will have the right to primarily use 1,00,000 dark fibre km or 23,000 route km of Bharti's NLD network, which is less than 20 per cent of the NLD capacity currently available with Bharti," a company statement said on Sunday.

VSNL is poised to start STD operations across the country and sharing of infrastructure with Bharti would help it save huge investments in building infrastructure.

The 1,00,000 fibre km NLD backbone will cover over 200 long distance calling areas (LDCAs) and keep VSNL much ahead of its NLD roll-out obligations.

"Bharti has always been a strong advocate of the sharing of infrastructure on mutually beneficial terms, so as to optimise investments," said Mr Rajan Bharti Mittal, Joint Managing Director, Bharti Tele-Ventures, while announcing the agreement.

"This applies not just to long-distance network but other infrastructure like cell sites for mobile operations. This industry-wide initiative would reduce costs for all the sharing parties, thereby helping in deepening the market and exploring the potential that the Indian telecom industry offers."

The augmented NLD backbone will provide benefits to VSNL's wholesale business segment, primarily catering to voice solutions.

The domestic backbone will also offer considerable cost optimisation benefits as all the three business segments - wholesale, corporate and retail - consume significant NLD bandwidth.

"Our existing business segments will have a captive source of domestic bandwidth for present and future growth drivers, resulting in significant cost savings," said Mr S.K. Gupta, Managing Director, VSNL.

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