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Siemens and Bharti Sign USD 50 Million Contract; Siemens to Expand and Operate Mobile Network for India's Largest GSM Provider

Posted on: Friday, 2 July 2004, 06:00 CDT

The mobile arm of Siemens (Siemens mobile) (NYSE:SI) (FWB:SIE) and India's largest mobile operator Bharti Tele-Ventures formed a partnership to optimize Bharti's mobile network. Siemens mobile will not only expand the GSM/GPRS network, but also operate and maintain it for the first time in Asia. The contract is worth around USD 50 million and will run for three years. Siemens mobile will expand Bharti's network in the circles of Kolkata, Madhya Pradesh and West Bengal.

The contract includes the supply of GSM core and radio network infrastructure as well as GPRS technology for providing seamless coverage in over 150 towns across the 3 circles. For the first time in Asia, Siemens mobile will also operate the mobile network, allowing Bharti to lower its operating costs and concentrate on its marketing and pricing strategy. For Siemens, it offers the advantage of being able to better coordinate the construction and operation of the network. Due to the fact that its service business is getting more and more important, Siemens also offers network optimization, security services and network operation to mobile operators.

"This agreement showcases Bharti's commitment in providing a high class network and improved quality of service to their customers in this fast changing market," said Christoph Caselitz, President of Networks at Siemens mobile. "We are proud to partner Bharti's rapid growth and provide coverage when and where Bharti needs it. This reinforces Siemens commitment to provide high class infrastructure and services to keep pace with the fast track of India's mobile evolution."

With more than 7 million customers, Bharti is India's largest GSM provider. Siemens and Bharti have been working together since 1998 in fixed network business and since 2001 in mobile communications. "We can look back on a long and trusting cooperation with Bharti. As their strategic partner and operator of the new networks we will ensure smooth operation and help Bharti to consolidate its leading position in India's GSM market," said Christoph Caselitz, President of Networks at Siemens mobile.

"While the agreement will ensure that we have a state-of-art network, wider coverage and significantly improved quality of service, we would also be able to leverage the economies of scale, thereby resulting in improved cash flows" said Manoj Kohli, President Mobility, Bharti Tele-Ventures.

India is one of the fastest-growing mobile communication markets. The country has around 30 million mobile phone customers, which means that only three out of every hundred Indians use mobile phone services today. Estimates predict that there will be 100 million mobile phone customers in 2005. For Siemens mobile, India is developing into the second most important market in Asia after China.

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