New Delhi : Bharat Sanchar Nigam Limited (BSNL) is to float a tender for procuring 15 lakh lines of GSM equipment for offering cellular service across the country by next week. BSNL plans to offer services by the second half of 2001. This follows the Telecom Commission's decision to approve the size and schedule of the tender in a recent meeting, official sources told The Financial Express. The size of the tender could be upwards of Rs 300 crore. The tender, which is coming at a time when the price of GSM equipment has been falling globally, is expected to bring down the per line price to a new low, thereby narrowing down the difference between mobile and fixed phone services, industry sources said.Major international players in the GSM market such as Lucent Technologies, Ericsson, Alcatel, Nokia, Siemens and Motorola are expected to participate in this largest open tender for GSM equipment in the Indian market. These companies have already begun to work out strategies to be adopted in the tendering process. The tender is interesting to watch out for as the GSM equipment cost per line had come down to $84 in the last open tender called by the Mahanagar Telephone Nigam (MTNL) for offering its cellular service in Mumbai and Delhi.
The MTNL tender was bagged by the ITI-Lucent venture against stiff competition, earlier this year. Indications are that this time around some of the companies are preparing to undercut each other further by quoting less than half of the MTNL tender's prices. This means the lowest quotations could be in the range of $40 to $50 per line or Rs 2000 to Rs 2,500. Given that the recent DoT tender for fixed phone switches was awarded to Lucent Technologies at just a shade below Rs 2000 per line-the race between GSM and fixed line would become a neck and neck one.
It would also explode the myth that mobile phone service is a premium service. After procurement of the 15 lakh lines, BSNL would offer Andhra Pradesh and Maharashtra close to two lakh lines each, Gujarat would get 1.75 lakh lines, Tamil Nadu would get 1.30 lakh lines and Kerala would get 1.25 lakh lines. All other circles would be allocated less than a lakh lines each. Meanwhile, the 43,000 lines pilot GSM project being implemented by BSNL along with the Centre for Development of Telematics (C-DoT), in five circles, has not yet taken off. As per a revised schedule in September last, the pilot project should have taken off latest by late October or early November.
Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.