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VoIP Systems

Nokia Siemens Lands $900M India Deal

Nokia Networks has landed a monster fixed and mobile expansion deal with Indian carrier Bharti Airtel Ltd. (Mumbai: BHARTIARTL) worth around $900 million, with analysts labeling the engagement as a "breakthrough" for the newly created giant vendor. (See NSN Wins New Bharti Deal.)

NSN, the joint venture which opened for business on April 1 this year, is already a major supplier to Bharti Airtel, India's largest mobile operator with more than 40 million subscribers, a market share of about 23 percent, and quarterly revenues of more than $1.3 billion. (See Nokia Siemens is Alive, Nokia Siemens Opens on a Downer, and Indian Carriers Grow Quarterly Profits.)

In October last year, the carrier awarded Nokia a $400 million GSM expansion and managed services deal as it, and India's other mobile operators, await a decision from the Indian government on 3G licenses. (See Nokia Snags New Bharti Deal and India on Edge Over 3G.)

But this is additional business, building on last year's deal, and expands the relationship into Bharti's fixed network and prepaid international calling card business.

Over the next two years, NSN is to supply mobile infrastructure, including base stations and mobile softswitches, OSS software, and a wide set of planning and integration services for GSM network expansion projects in eight of India's 23 "circles," the country's mobile services zones.

The carrier needs to add network capacity to cope with the nearly 2 million new customers it is adding to its subscriber base each month, and is also extending its network coverage further into rural areas, where mobile usage is becoming increasingly popular and stimulating economic growth.

During the same timeframe NSN is also supplying a range of Surpass (Siemens) softswitches, media gateways, and media servers to add 1.8 million long distance and international voice ports as part of Bharti Airtel's fixed network expansion project.

The calling card capabilities will be supplied over a three-year period and be based around NSN's [email protected] intelligent networks (IN) platform, and will expand the carrier's calling card system capacity by 4.5 million potential customers.

Dresdner Kleinwort 's Per Lindberg believes the broad range of systems included in a single deal is significant for the vendor. "The breakthrough integration order represents one of the finest coups for the enlarged group," states Lindberg in a research note issued Tuesday.

The combination of mobile, fixed, and IN systems "marks a significant step-up from the current run-rate of business relationship" between the vendor and carrier.

News of the deal helped push Nokia Corp. (NYSE: NOK)'s share price up by 1.6 percent to €21.27 on the Helsinki Stock Exchange.

But NSN is not the only supplier deeply entrenched at Bharti Airtel: Ericsson AB (Nasdaq: ERIC) is also a major mobile infrastructure provider, while IBM Corp. (NYSE: IBM) is playing a key role as the carrier's lead service delivery platform (SDP) supplier. (See Ericsson in $1B Bharti Expansion and IBM to Manage SDP for Bharti .)

NSN and Ericsson are also the key suppliers for the massive GSM expansion project planned by one of Bharti's main rivals, Bharat Sanchar Nigam Ltd. (BSNL) . (See BSNL to Award $4.5B Mobile Contracts.)

— Ray Le Maistre, International News Editor, Light Reading

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