Reliance Integrates Global Services
The subsidiary will bring together Reliance's global voice, managed network services, carrier Ethernet, and subsea capacity businesses under a single brand as the company embarks on an expansion of its international network.
Reliance had been mulling over a plan to list FLAG Telecom shares on the London Stock Exchange; instead it will be Reliance Globalcom that goes public.
U.S.-based Ethernet services provider Yipes, which Reliance acquired last year, will act as the enterprise business division of Reliance Globalcom. Submarine cable operator FLAG is being renamed the Reliance FLAG carrier services division.
Globalcom will also include retail voice services such as Reliance India Call and Reliance Global Call virtual calling cards.
Reliance's global services operations brought in revenues of 13.3 billion Indian Rupees (US$333.21 million) during the quarter ended Dec. 31, accounting for 22 percent of its total revenues. That figure doesn't include revenues from Yipes, since the acquisition was completed in late December. (See Reliance Completes Buy.)
As part of the integration of its service portfolio, Reliance plans to invest $200 million over the next two years to double the number of U.S. markets served by the new enterprise business division to 28, and to begin marketing its services to the 37 countries where Reliance FLAG operates. (See Yipes! Here Comes a Spending Spree.)
FLAG is in the process of building a $1.5 billion next-generation IP network on 50,000 kilometers of additional submarine cable that it says will ultimately extend its reach to 60 countries. (See Fujitsu Scores Massive FLAG Deal.)
The reorganization follows a similar move over at rival Tata Group, which recently combined its international operations under the Tata Communications Ltd. brand. (See VSNL Rebrands as Tata Communications.)
— Nicole Willing, Reporter, Light Reading