BSNL, MTNL sign pact for offering pan-India mobile services

RK Upadhyay, CMD, BSNL

IN A bid to offer better services to their consumers and also to tide over massive financial losses over the past few years, state-owned telecom giants Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL)  have signed a memorandum of understanding (MoU) to share the infrastructure and network of each other. A media report suggests that BSNL and MTNL will...

be sharing infrastructure like buildings, mobile masts, and international long-distance phone networks to offer joint services to corporate customers. Both the companies are working on an arrangement through which the roaming charges will be gradually reduced and eventually waived off. BSNL currently operates in all telecom circles besides Delhi and Mumbai while MTNL operates only in Delhi and Mumbai. The two telecom PSUs have not been able to provide services on pan-India basis on competitive basis due to geographical restrictions as per licence conditions, whereas private players are providing such services.

According to the MoU, MTNL will avail the network of BSNL only for national roaming service for its subscribers except in Delhi and Mumbai and BSNL will only use MTNL network for roaming services to its customers in Delhi and Mumbai. MTNL would offer all its NLD (national long distance) traffic to BSNL except for the traffic between Delhi and Mumbai.

There is likely to be greater synergy between the two on operational issues, commercial issues, customer delivery, IT integration, infrastructure sharing and business promotion. The MoU has been inked on mutually-agreed conditions for revenue sharing.

At present, MTNL and BSNL do not charge any roaming fee for mobile internet services on each other’s customers. MTNL CMD AK Garg said that both companies will work to have similar arrangement for phone calls also. “We have made certain packages in pre-paid where it (roaming) is allowed on payment of small amount but yes once this synergy are there we will work out to have similar situation for voice also,” Garg said.

“In the NCR, leaving Delhi, where a BSNL customer is on roaming, he is not charged for it. We would like to enlarge that area individually on pan-India basis so that mobile customer does not pay any fee for roaming,” RK Upadhyay, CMD, BSNL, said.

MTNL reported net loss of Rs 1256.19 crore in Q1 June 2013, higher than net loss of Rs 1059.29 crore in Q1 June 2012. While BSNL is not a listed company, it had reported a total loss of Rs 6,536 crore for the nine month period ending December 31, 2012.

Currently, a Group of Ministers (GoM) headed by finance minister P Chidambaram is considering a revival proposal for both the state-run telecom operators.