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INDIA BUSINESS WORLD - 1st May To 15th May- 2009
BHARTI AIRTEL FORMS JOINT VENTURE WITH ALCATEL-LUCENT TO RUN FIXED-LINE BUSINESS
BHARTI Airtel has entered into a joint venture with Franco-American telecom gear maker Alcatel-Lucent to manage its landline and broadband business, expanding its tested strategy of outsourcing technology functions to focus more on marketing and sales.
Bharti, India's largest telecom company, will be the minority partner in the 26:74 joint venture, and will invest Rs 2,500 crore into the new entity over five years.
"In 40 countries, Alcatel-Lucent has carried out the transformation of fixed-line networks to make them internet protocol-based and also next generation network-enabled. This is the type of support we want, and we chose Alcatel-Lucent," said Bharti Airtel CEO Manoj Kohli.
Bharti has made outsourcing a key plank of its business strategy, and has signed billion-dollar deals with network vendors such as Ericsson and Nokia Siemens, which manage, build and operate its mobile network. It pioneered the network outsourcing model in 2004 by awarding IBM a 10-year, $750-million contract, whose scope is now worth $2.5 billion.
Another billion-dollar pact exists with six BPOs, which collectively handle Bharti's customer services for a 10-year period.
However, this is the first time the company is forming a JV to handle a core business instead of outsourcing it to a third party.
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