RCOM May Outsource Services to Cut Costs
MUMBAI: Reliance Communications (RCOM) is looking at outsourcing the management of its broadband and fixed-line services in a bid to cut costs. The contract, which could be upwards of $1 billion, is likely to be awarded in the next 3-4 months.
“We want to outsource the management of our optic fibre, broadband and fixed-line services. We are in discussions with interested parties and should be able to finalise it in the next three months,” RCOM’s head of managed services Sandip Biswas told ET on the sidelines of a conference in Mumbai on Wednesday. In July last year, RCOM outsourced the management of its wireless networks across India to Alcatel-Lucent Managed Solutions. RCOM has one-third stake in this JV, which will also bid for RCOM’s upcoming wireline outsourcing contract.
The move comes just months after rival Bharti Airtel announced a five-year, $500-million contract for management of its broadband and fixed-line services. The contract was awarded to a JV that Airtel has with Alcatel Lucent (ALU).
The business of Alcatel Lucent-RCOM JV has grown by 50% to $750 million (Rs 3,600 crore) in the past one year, as RCOM, which was its only customer so far, expanded GSM networks. The size of the five-year contract was pegged at $500 million when it was announced a year ago. “Going forward, the principal work will be outside India,” Alcatel Lucent India president Vivek Mohan said.
