Cisco-backed Teracom set to become BSNL's franchisee for WiMax in 8 circles

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Our Bureau

New Delhi, Jan. 24

Bids submitted by equipment maker Teracom, backed by US technology giant Cisco, has emerged as the best offer to become Bharat Sanchar Nigam Ltd's franchisee partner for offering urban WiMax broadband services in eight circles.

Another bid from Take Solutions backed by Chinese manufacturer ZTE has emerged as the best offer in three circles and bids by companies backed by Israeli equipment maker Alvarion has offered the highest revenue share to BSNL in five circles.

Revenue sharing

BSNL had received bids from five companies for rolling out WiMax-based broadband services on a revenue sharing model. The fifth bid from E-Mall, backed by ZTE, did not make the cut.

The bidders have offered to give between 10 per cent and 32 per cent of the revenue earned across various circles to BSNL.

When contacted, Mr. Puneet Jain, Senior Vice-President, Corporate Business, Teracom Ltd, said, “Our business model is already in place as far as joining hands with BSNL is concerned. We have already initiated internal process to recruit more qualified manpower which will be required not just for Wi-Max rollout in the entire circle area, but also for marketing & sales, advertisement, retail management.”

Second attempt

This is the second attempt by BSNL to appoint franchisee for rolling out broadband services in urban areas. The first time project had run into controversy after it was found out that some of the bidders existed only on paper. BSNL's existing franchisee partner Soma had not put in any bids.

Even though BSNL was given the spectrum almost a year ago, it has not been able to take advantage of the lead it has over private players due to delays in finalising the tender.

The PSU had divided its WiMax roll out into two parts. While the franchisee part got delayed due to the poor tender conditions, the rural part has seen some movement forward. Chennai-based Gemini Communications, ZTE, US-based Harris Stratex and Alvarion had emerged as the four lowest bidders for the supply of 7,000 WiMax base stations to BSNL in the rural areas.

(This article was published in the Business Line print edition dated January 25, 2010)
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