ITI Ltd, the government of India concern formerly known as Indian Telephone Industries Ltd, said it has been handed over 6,945 cells sites by state-owned Bharat Sanchar Nigam Ltd or BSNL for management and marketing.
“ITI has received an Advance Work Order from BSNL for the Operation and Maintenance and Sales & Marketing of the Passive Infrastructure of 6,945 BTS sites of BSNL’s GSM network in UP East, UP West, Uttarkhand and Tamilnadu Circles,” the struggling telecom equipment maker said.
The provisional value of the contract is Rs 6,633.56 crores inclusive of taxes, it said.
The order is for a period of 10 years.
BSNL has been exploring the possibility of spinning off or otherwise handing over its towers to a third party for effective management and monetization.
The company has been struggling to maintain these sites due to financial difficulties and low staff strength.
Due to their strategic location, the sites themselves are considered lucrative from the perspective of enabling seamless network coverage, especially in urban areas.
Many of these towers are located inside BSNL telephone exchanges, and have a lot of extra space that can be rented to other telecom operators in return for monthly charges.
BSNL has been cutting its staff in recent years to cut costs, which made it more desirable that the process of maintaining the towers and renting them out be handed over to a third party.
ITI, once a big supplier of landline telephones and other equipment to BSNL, has never managed to recover from the decline of landline telephones. The deal is likely to give the company much-needed revenue.
BSNL has been hit hard by the transition from 3G to 4G wireless services, and the ensuing crash in prices.
Against Rs 200 or so per GB of data in the 3G era, prices have declined to around Rs 10 per GB, hurting BSNL as the company has not been able to roll out its 4G network even eight years after getting the spectrum.