INDIA BUSINESS WORLD - JUNE - JULY - 2007
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NOKIA SIEMENS BAGS $900-M BHARTI NETWORK DEAL

BHARTI Airtel, the country's largest mobile operator, on July 3 announced yet another outsourcing deal by signing a $900 million network expansion contract with Nokia Siemens Networks. The company will raise resources internally to fund the order.

"As per the deal, Nokia Siemens Networks (NSN) will expand Airtel's GSM network in eight circles and will also enhance Bharti's national and international long distance with 1.8 million Next Generation Network (NGN) ports. Besides, Nokia Siemens Networks will also provide the platform for increasing the company's capacity for its international prepaid Calling Card 4.5 million news users," Bharti Airtel's CEO Manoj Kohli told reporters after signing the memorandum of understanding (MoU) with Nokia Siemens Networks CEO Simon Beresford Wylie.

The GSM and NGN expansions are planned over two years and the international calling cards expansion over three years, Mr. Kohli added.

At the same time, Bharti is also in talks with Ericsson, which currently manages its network in 15 telecom circles for a similar network expansion deal. This will be in addition its $1 billion three year service contract which it had awarded to Ericsson last year towards design, planning, supply, installation, commissioning and upgrading of Airtel network in 15 telecom circles.

"Discussions with Ericsson are ongoing," Mr. Kohli said when asked if Bharti and Ericsson were likely to sign a deal similar to that with Nokia Siemens Networks. Mr. Kohli, however, refused to divulge additional details.

This is Bharti's fourth network expansion deal with Nokia - in May 2004, it had signed a three-year deal with the Finnish company a valued at $275 million to build and manage networks across five circles, topping it with another $125 million three-year agreement in August 2005 for GSM/EDGE expansion in eight circles and followed it up by another deal in October 2006 for the same eight circles for $400 million.

The GSM outsourcing announcement will cover the eight existing circles of Mumbai, Maharashtra and Goa, Gujarat, Madhya Pradesh and Chhattisgarh, Bihar and Jharkhand, Orissa, Kolkata and West Bengal where Nokia Siemens Networks already provides equipment and managed services. The contract includes network planning, implementation and project management, handling of local logistics and materials as well as system integration for the base station sites.

Mr. Kohli also added that expansion of its IN platform for its calling cards would enable the company to expand this service to nine other countries by March 2008. Bharti Airtel had launched calling cards in the US in 2006, following some technical glitches there; the company had temporarily deferred its plans to extend this service to the top 10 countries in terms of the NRI population.