India's state owned operator, BSNL is expected to invite fresh bids for the 40% of its controversial GSM tender after Nokia Siemens Networks refused to take up its allocation, and Ericsson decided not to take up the surplus either.
In October 2006, the tender process for the modernization, upgrade and capacity expansion contract, which initially involved the supply of 45.5 million GSM lines, which was later reduced by the government to 22.75 million lines.
According to the terms of the deal finalized in September, 60% of the contract was given to Ericsson for $1.3 billion, while the rest had to be awarded to the second lowest bidder, Nokia Siemens, who then had to match the lowest bid, which was about $90 a line. Nokia Siemens then said was too low for it to accept the rest of the order after its initial tender had been US$170 per line.
"We will issue a new tender for adding GSM capacity in January next year," BSNL Chairman and Managing Director Kuldeep Goyal told reporters on the sidelines of a seminar.
While China's ZTE and Huawei were originally disqualified as the bidders had to have local manufacturing facilities - the price pressure and inability of other vendors to match the low price demanded by BSNL may encourage them to reconsider the local manufacturing clause.
Posted to the site on 13th December 2007
Posted to: www.cellular-news.com/story/28054.php