India’s BSNL and BBNL to merge this month

Details: Vaughan O'Grady; Category: Optical & Fixed Networks; 21 March 2022; 6218 views

The Indian government is reportedly going ahead this month with the planned merger of government-owned broadband infrastructure provider Bharat Broadband Nigam Ltd (BBNL) with the loss-making state-run operator Bharat Sanchar Nigam Ltd (BSNL).

It appears that BBNL is going to be merged into BSNL, which means that all work assigned to BBNL at the pan-India level will come to BSNL. This plan was first reported in some Indian news media as early as January.

BSNL already has a network of nearly 700,000 kilometres of optical fibre cable (OFC). To this will be added about 567,000 kilometres of optical fibre which has been laid across 185,000 village panchayats (village councils or basic village-governing institutes).

Described as a special purpose vehicle or SPV, BBNL (BharatNet) was formed in February 2012 to lay out an optical fibre network across 250,000 village panchayats across the country via what is known as the Universal Service Obligation Fund (USOF), providing access to all telecom operators (who pay a levy for the privilege) on a non-discriminatory basis. Unlike private operators, BBNL is not subject to right of way (RoW) charges for its rollout.

This hasn’t always gone to plan. We reported in February that BBNL had cancelled a massive tender worth somewhere in the region of US$2.52 billion which aimed to connect villages across 16 states with an optical fibre-based high-speed broadband network; non-participation was cited as the reason.

BSNL chairman and managing director PK Purwar has been quoted as suggesting that the next phase of telecom growth will come from fibre-to-the-home services and that, in the coming days, 100,000 mobile base stations will serve as a point of presence for the distribution of fibre-based broadband connections to subscribers.

What this means for BSNL’s other ongoing plans, such as 4G test and rollout, is not clear. It’s also unclear whether or how the merged entity will be positioned to deliver cost-effective and efficient services – or indeed deal with its debt burden.