Ericsson and Bharti sign Managed Services and infrastructure contract

Ericsson and Indian operator Bharti leverage their cooperation to accelerate growth and performance in the high-growth Indian market. Under the agreement Ericsson combines its strengths in equipment and services to deliver and manage available network capacity when and where Bharti needs it.
Press release
Feb 09, 2004 09:49 (GMT +00:00)
The three-year contract of Managed Services, network infrastructure and rollout is valued at approximately USD 400 million and includes operating and optimizing Bharti's GSM/GPRS network. Ericsson will continuously deliver equipment and services based on Bharti's capacity requirements, improving efficiency by eliminating overlap and duplication of roles between the two companies as well as securing cost-efficient roll-out and operation of on-demand capacity.

"This agreement is an indicator of Bharti's innovative approach to this fast changing market and takes our long relationship with Bharti to the next level," says Hans Vestberg, Senior Vice President business unit Global Services, Ericsson. "We are honored to be chosen to support Bharti's rapid growth and provide coverage when and where Bharti needs it. The contract with Bharti reconfirms our position as the clear telecom leader."

"The agreement is set to redefine the telecom landscape in the country and help us contribute towards a robust telecom infrastructure overall," said Mr. Akhil Gupta, Joint Managing Director, Bharti Tele- Ventures Ltd. "Telecom is a core infrastructure area and an initiative of this kind will enable us to focus on our core areas while also simultaneously allowing us the benefits of a world class network, managed and monitored by the specialists."

Under the agreement approximately 250 of Bharti's technical experts will be taken over by Ericsson India. These highly qualified experts will strengthen Ericsson India services offering.

About Bahrti
Bharti Tele-Ventures (BTVL) is India's leading private sector provider of telecommunications services with an aggregate of 6.45 million customers as of January 31, 2004, consisting of approximately 5.86 million mobile and 587,872 fixed line customers. Bharti is the largest GSM service provider in the country. The company's all India market share as on January 31, 2004 was 25.1%. Mobile services constitute the largest portion of company's business both in terms of total revenues and total customers. Bharti also provide fixed-line, long distance, group data and enterprise services including VSAT and Internet services.

The company seeks to capitalize on the growth opportunities that it believes are available in the Indian market and consolidate its position to be an integrated telecommunications service provider, with a focus on mobile services. For the year ended March 31, 2003, the revenue and EBITDA as per un-audited IAS accounts were Rs.3,050 crore (US$ 642 million) and Rs.759 crore (US$ 160 million) respectively.

For the quarter ended December 31, 2003, Bharti's revenue and EBITDA as per un-audited IAS accounts were Rs. 1,269 crore (US$ 278 million) and Rs. 473 crore (US$ 104 million) respectively. The company has registered a profit of Rs. 400 crores (US$ 88 million) for the quarter. During the quarter-ended December 31, 2003, mobile services represented approximately 68% of our total revenues. As on December 31,2003, the company has made a gross investment of over Rs. 11,750 crore (US$ 2.6 billion) in building telecom in India.

The Company today offers mobile services in fifteen out of 23 circles in India. As of January 31, 2004, approximately 91% of India's total number of mobile subscribers resided in Bharti's mobile circles, according to COAI reports. Bharti Tele-Ventures was the first private sector operator to provide fixed-line services in India when it commenced providing fixed-line services in the Madhya Pradesh & Chattisgarh circle in June 1998. The Company also provides fixed - line services in Haryana, Delhi, Karnataka and Tamil Nadu circles. BTVL believes that these circles have high telecommunications revenue potential, especially for carrying data traffic.

The company complements its mobile and fixed-line services with national and international long distance services. The company also has a submarine cable landing station at Chennai, which connects the submarine cable connecting Chennai and Singapore. The long distance and data enterprise services has enormous support from this connectivity and facilitates in offering best value to our customers.

The company provides reliable end-to-end data & enterprise services to the corporate customers by leveraging its nationwide fiber optic backbone, last mile connectivity in fixed-line and mobile circles, VSATs, ISP and international bandwidth access through the gateways and landing station.