NEW DELHI: A Department of Telecommunications (DoT)-led panel has rejected state-run telco Bharat Sanchar Nigam Limited's (BSNL) concerns over 4G core technology from home-grown equipment makers. The development is expected to be beneficial for domestic gear vendors like Tejas networks, Tech Mahindra, C-Dot, VNL, and HFCL that are vying for BSNL’s 4G core network deployment.
The development is likely to affect global vendors like Nokia, Ericsson, ZTE, and others that have previously supplied gear to BSNL.
The DoT-led panel has further recommended that a comprehensive homegrown telecom stack needs to be established with an emphasis on indigenous manufacturing, as per a Business Standard report.
In its letter, BSNL had said that having two different cores for its network – one for existing 2G and 3G and another for 4G - would impact the quality of service as there will be two different cores. Secondly, the telco is unsure about the new core which is unproven and is going to be from local companies.
BSNL had also wrote to the Department of Telecommunications (DoT) that the prices offered by domestic OEMs are “uncompetitive” and they are upto 89% higher as against the prices offered by global vendors. It had further alleged that domestic vendors have missed 25 of 35 floated tenders in the past
However, homegrown telecom companies had denied any cost escalation and said that the government should prevent predatory pricing in the Bharat Sanchar Nigam Limited's (BSNL) telecom equipment supplies to ensure the success of Atamanirbhar Bharat (self-reliant India).
Further, the committee also rejected BSNL’s contention that it should be adequately compensated for the losses incurred due to the six-months delayed 4G rollout caused by the cancellation of the tender, and also for future delays considering that the domestic vendors are yet to furnish proof of concept.
Another point of contention is that BSNL may need to run two separate cores--one solely for 4G services, and one for 2G, 3G, and 4G which will likely increase the consequent Capex and Opex considerably.
However, the committee has refuted the allegation, saying that there is no requirement for BSNL to buy 2G radio access network and added that it is time for BSNL to migrate 2G customers to 4G.
Late October BSNL wrote to the telecom department (DoT) flagging that any non-investment in 2G networks will impact its revenue stream and will put it at a significant disadvantage in the market. As of December 2019, around 60% of Vodafone Idea customers were on 2G, while Airtel had 47% 2G users and BSNL close to 70%.
BSNL has also argued that it will not be feasible to verify whether a company is headquartered in India or not, as per the committee’s definition of an “Indian core”. However, DoT opined that the issue can be resolved by asking the bidder to furnish self-clarification.
Additionally, the cash-strapped telco has expressed its apprehensions over the structure of proof of concept and said it will not be feasible to check equipment specifications within the stipulated time of four months.
