In India’s dynamic telecommunications landscape, BSNL finds itself under scrutiny due to its recent 5G tender conditions. Nordic telecom giants, Ericsson and Nokia, have voiced their dissatisfaction. The core issue revolves around BSNL’s mandate to use only locally manufactured equipment for the 5G network expansion. This requirement comes as part of BSNL’s broader strategy to roll out 5G Standalone (SA) services within New Delhi.
During a pre-bid meeting with BSNL, companies, including L&T Technology and TCS, were present. Both Ericsson and Nokia requested that the requirement for domestic gear be relaxed. However, government officials remained firm, supporting the local telecom equipment industry and upholding similar conditions in BSNL’s ongoing 4G expansion.
To compound the challenge, Ericsson and Nokia are experiencing a slowdown in orders. Major players such as Reliance Jio and Bharti Airtel have nearly completed their 5G rollouts. Thus, Vodafone Idea remains one of the few prospects for 5G deployment opportunities in India.
Another sticking point for potential bidders is BSNL’s proposed revenue-sharing model. The terms allocate a minimum of 70% of revenue to BSNL, leaving a modest share for vendors. The upfront investments, especially the bid security and performance guarantees, make the financial terms unattractive for many bidders. In response, vendors have proposed a more balanced revenue share of 30% for BSNL, with profit-sharing commencing only two years post-launch, allowing time for customer acquisition.
In terms of logistics, the tender specifies using the 900 MHz and 3.3GHz bands to deliver 5G SA connectivity across various locations in New Delhi. Successful bidders will handle the network’s planning, design, and equipment supply, along with its deployment and management. The network setup involves dual providers for 5G services—one primary and one secondary—each working with equipment from up to two manufacturers.
BSNL has begun testing its indigenous 5G technology at key locations in New Delhi, including Nehru Place and Minto Road. The company aims to launch its 5G services in 2025, following the completion of network trials. For now, BSNL has extended its bid submission deadline to December 16, expecting to address some of the vendors’ concerns and streamline the bidding process.
