Reliance Integrates Global Services

Indian operator Reliance Communications Ltd. (RCom) is combining its global services operations, including FLAG Telecom Ltd. and Yipes Enterprise Services, into a new unit to be called Global Cloud Xchange . (See Reliance Creates Globalcom.)

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

fanfare 12/5/2012 | 3:47:22 PM
re: Reliance Integrates Global Services Gee, I can't understand why anyone would be spending so much $$ to build out ... after all, we have such an over capacity of carrier infrastructure .... (don't we?) ... sarc

I'd like to see some projected numbers for this company (build out). Also, nice work on the revs from India .... but I think it would be pertinent to get some more insight on the income, expected, and spending overall... if possible. Hey, I realize you guys are not psychic ... but you've been around a while eh?

Not for nuttin but (well, maybe for somethin)... thanx for the work you guys do. In truth, LR has been a pillar throughout this crazy telecom roller coaster ride... all the way back to the 90's when we all got rich (and then later signed on for food stamps). I think even critics have to admit that your team has managed to stand a notch above others in most respects. Congrats.
Kreskin 12/5/2012 | 3:47:21 PM
re: Reliance Integrates Global Services

I won't kiss up to LR.

Anyhow, Reliance bought Yipes for its base. They are not building out. Yipes came with IRU'd fiber, they don't own a network or can claim network diversity. In Yipes markets ... the top ten cities in the US ... many, many, many fiber options are available. Below the top ten, not necessarily the case.

Count on Reliance to pick off a few more of private metro fiber owners in the coming months in the US. They paid 20x forward EBITDA for Yipes 2 (Yipes 2 because the first Yipes went bankrupt).

Reliance has stated on more than one occasion, they are going to be a presence in the United States.

fanfare 12/5/2012 | 3:47:12 PM
re: Reliance Integrates Global Services Two things:

first you say Reliance is not building out ... the article states:

...as the company embarks on an expansion of its international network.

Doesn't matter to me if they build or buy ... my comment was a sarcastic play (note the 'sarc' at the end) on the 'over-capacity' position. Not important really.

On "kissing up to LR". Seems if you are not beating the crap outta someone .. you are kissing up to them. Big taboo to say something positive eh?

Hey, I've been posting to this board a while .. and one thing I know is that everyone dumps on LR staff. I rarely read any 'back pats' in discussions. I have leaned on them pretty heavily myself over the years. However, the last couple years I have noted that they have been first in getting more than their share of news in the telecom industry. I gave them 'Kudos' cuz I felt they deserved it. Haven't you ever done anything that deserved a little 'attaboy'? Would you begrudge LR staff a little 'thanx' from one of their readers? How much does it cost you to log onto this site and read these articles? I can still remember the days when I had to pay for (or my company had to pay for) all our trade jounals. I think LR has done more than a few things right the last few years ... and I don't think mentioning it is 'kissing up' to anyone.
Sign In