BSNL plans to hive off tower infrastructure: Greater efficiency at lower cost
Loss-making government-owned telecom service provider Bharat Sanchar Nigam Limited (BSNL) is planning to hive off its 70,000 strong telecom tower infrastructure into a separate company. The move may be seen as one more addition in the list of steps the state-run telcom company is taking to bring its balance sheet back into black.
So far, the private telecom companies that have hived off their tower businesses are getting positive returns. However, only time will tell if the proposed move by the PSU telecom operator would be successful in providing the much-needed shot in the arms of the ailing firm. BSNL is expected to issue expression of interest this week to appoint a consultant to advise a business
Leading telecom analyst Mahesh Uppal terms the BSNL's plan to hive off its tower infrastructure as a good move. “I think it is a good move, a welcomed move. Infrastructure is the most difficult part of the telecom business. It is a way to make use of its infrastructure that can be put to more productive use,” Mahesh Uppal told this citizen journalist
. However, he says that the proposal to hive of the tower infrastructure should not be seen as shot in the arms.
“I do not like to see this step in that way. It is just like you are in losses and you sell your house and gain 5 lakhs extra it doesn't mean it is a shot in the arm,” said Uppal.
Uppal added that the decision to hive off the infrastructure would have been better if taken earlier but still it is not late. He said that the BSNL's proposed move will not impact customers in any way and it will result into greater efficiency at lower cost for BSNL.
On BSNL's present condition Mahesh Uppal said that the company is making loss and going through a bad and challenging phase.
A committee under the supervision of Sam Pitroda
, who is currently Advisor to the prime Minister of India
on Public Information Infrastructure & Innovations, has suggested BSNL to hive off its tower businesses as a part of its several other recommendations to turn the fortunes of the loss making entity.
The state-owned teleco has announced in past to take various steps in a bid to slash its mounting losses. BSNL is optimizing CAPEX and OPEX through convergence and consolidation of infrastructure. The company is making effort in the direction of strengthening stable revenue streams via concerted focus on broadband and enterprise business with major focus on government projects.
BSNL has decided to focus on the revenue from top 100 cities for monitoring purpose. The company will focus on customer care, service delivery, service assurance, revenue management and asset management. It has decided to aggressively push on data usage and value added services. BSNL will also separate commercial activities from social obligation to ensure sustainable growth.
Last but not least the PSU operator will migrate from current network to next generation network to ensure convergence, consolidation and seamless delivery of various services to end customers across different technologies.