Bharti, Ericsson In Huge Outsouring Deal

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In a major outsourcing deal, Bharti Group, offering telecom services under its brand Airtel, on Tuesday signed a contract with Swedish telecom giant Ericsson worth $250 million (about Rs 1,075 crore) for setting up and maintaining GSM cellular network in 3,000 towns across India.

"Ericsson's technology and managed service solutions will enable Bharti to expand into around 3,000 towns and villages in 15 regions," Hans Vestberg, Executive Vice President, Ericsson, said here while announcing the contract.

This is part of Bharti's initiative to roll out its network in rural India. Bharti is the only private telecom operator offering services in all 23 circles.

This is the second deal between Bharti and Ericsson. Last year, they had signed a mega deal worth $400 million.

Based on Bharti's capacity requirement, Ericsson would provide design, deployment, integration, optimisation and management of Bharti's network in the 15 regions.

These 15 circles are Delhi, Haryana, Punjab, Himachal Pradesh, UP (West), Andhra Pradesh, Tamil Nadu, Chennai, Karnataka, Kerala, Rajasthan, UP (East), Jammu and Kashmir, Assam and North-East.

"Ericsson's advanced solutions and services enable us to make this strategic move towards rural areas in India," Manoj Kohli, President (Mobility), Bharti Tele-Ventures, said.

Vestberg said the rollout in the first phase of this ongoing coverage expansion into rural India will start in July 2005.

"Ericsson delivers and manages network capacity when and where Bharti needs it. As a result, Bharti is free to focus on customers and business development, growing its business and efficiently evolving its networks," he said.

"Fast deployment will allow Bharti to offer services with minimised payback time in rural areas with low average revenue per user," he added.

Ericsson also provides its Expander solution for rural coverage to optimise both capital and operational expenditures and ensure minimal total cost of ownership for Bharti's network.

Jan Campbell, Managing Director, Ericsson India, said the agreement reinforces Ericsson's position as Bharti's strategic partner. "The expansion will allow Bharti to offer new and enhanced services to its customers, as well as cover new and untapped rural areas," he said.

Courtesy - rediff.com