Delay in 4G Rollout and Non-Procurement of 2G Equipment Will Impact Revenues: BSNL

BSNL is seeking a ‘fair compensation’ from the government for delaying the rollout of 4G services in the country. Besides 4G services, the state-run BSNL also wrote to the government to compensate for non-upgradation of radio equipment from ZTE and lack of providing excellent 2G services to the users because of non-procurement of equipment the development was first reported by ET Telecom. BSNL is still struggling to match the likes of Reliance Jio and Airtel due to the lack of 4G services. The highly competitive Indian telecom market is all about affordable tariff plans and 4G services. While BSNL is a strong contender in the tariff plans segment, it fails to match the rivals in 4G network aspect. So far, BSNL managed to launch 4G services in select circles with the help of the existing 3G spectrum.

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BSNL Being Stopped from Procuring 2G Equipment

Exactly a year ago, the government announced a massive revival package for BSNL as part of which MTNL will act as a subsidiary to BSNL. However, the revival package is yet to have an impact on BSNL; For the unaware, BSNL is yet to place an order for building 4G network. Thanks to the pandemic, BSNL 4G tenders are getting postponed.

Keeping the BSNL 4G tender issue aside, it is also said that a ‘special committee’ appointed by the government is not allowing BSNL to procure 2G equipment. The reason behind this is the committee wants all the BSNL 2G users to be migrated to 4G once the service launches.

Citing the above reasons, the telco has now approached the government asking for compensation because these factors will impact the revenues and profitability which were fixed at the time of designing the revival package. “Deterioration of 2G services on account on non-procurement of 2G equipment for replacement will severally impact revenue and market share of BSNL,” the company has written, according to ETTelecom.

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Having said that, BSNL might prepare a revised 4G tender after receiving a proper response from the government on these issues. It is high-time for BSNL to roll out the 4G services as the top two private telcos (Jio and Airtel) said to have more than 95% of LTE availability.

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