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Telecom infrastructure company Viom Networks Ltd has bagged a contract to provide Wi-Fi and other Internet-related services at the Chennai International Airport.
Market sources point out that the deal is expected to be in the range of Rs 20–30 crore. Both Viom and AAI refused to comment on the deal size.
This would be Viom’s first foray outside the telecom tower business. With nearly 42,000 telecom towers, the company is currently the second largest operator in the country after Indus Towers.
Viom Networks is a joint venture between the SREI Group of Kolkata and Tata Teleservices.
According to H.S. Suresh, Director, Chennai Airport, services include providing infrastructure to ensure Wi-Fi across the airport. Other “Internet-based services” - that generally include cable TV services (DTH) – will also be provided along with it. Agreements between Viom and the Airports Authority of India (AAI) were signed in July.
“We signed the contract with Viom two months back. As per the contract, Viom would pay us a licence fee of Rs 24 lakh a month (or Rs 2.88 crore annually). This is a seven-year contract,” Suresh told Business Line .
According to him, Viom Networks will develop the infrastructure at the airport and have tie-ups with other telcos (telecom companies) for offering internet-based services.
Revenue
Market sources point out that Viom would have to partner with a telecom company to provide Internet and Wi-Fi services.
In terms of revenue, the Viom can earn from providing infrastructure services to its telecom service provider. Those aware of the deal say that Viom will provide backend infrastructure services only.
Viom, however, refused to comment on the deal. “As per corporate policy we do not comment on market speculation,” a company spokesperson said.
According to Katyayan Gupta, analyst at Forrester Research, Viom’s decision to opt for in-building solutions shows its intention to evolve from a “telecom infrastructure” company to a “systems integrator”.
“The company has the necessary expertise in telecom infrastructure to leverage itself in other verticals,” he added.
Other Verticals
Following a surge in data growth and limited opportunities in the tower business, Viom has been trying to move into other revenue generating verticals.
Some of the verticals include third-party managed solutions (managing telecom tower infrastructure for operators) and in-building solutions (improving internet connectivity and Wi-Fi services within buildings).
Viom is already in talks with Telenor for setting up and managing towers in Mynamar.
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