Bharti Airtel has reportedly planned to issue orders worth around $ 1 billion to Ericsson, Nokia, and Samsung for 4G network equipment over the next three years. The new contracts are intended to accelerate the transition of Airtel’s feature phone users to smartphones and enhance revenue per user.
Airtel’s decision to embark on another phase of 4G network expansion is aligned with its goal to strengthen mobile broadband coverage in five key circles including Gujarat, Maharashtra, Madhya Pradesh, Kerala, and West Bengal, where its 4G presence is currently limited. The telco also aims to enhance 4G coverage in non-census towns and villages across India, as it works to swiftly transition its remaining 95 million 2G users to 4G.
Ericsson is likely to supply 4G base stations for 11 circles, including Rajasthan, Haryana, Delhi, Uttar Pradesh (UP)-West, Himachal Pradesh, Jammu and Kashmir, Assam, Northeast, Andhra Pradesh, Tamil Nadu, and Karnataka. Meanwhile, Nokia may provide 4G base stations for nine circles including Mumbai, Gujarat, Madhya Pradesh, UP-East, Bihar, West Bengal, Odisha, Maharashtra, and Kerala and Samsung for Kolkata and Punjab.
In addition, Airtel is expected to pay all the three vendors through letters of credit. These letters of credit will serve as a guarantee that Airtel’s future payments to the vendors will be made on time and for the agreed-upon amount. A media report suggests that the contracts will address 300,000 new 4G base stations, with Ericsson, Nokia, and Samsung supplying about 50 per cent, 45 per cent, and 5 per cent of the equipment, respectively.
The company is also working on the procurement of more 5G network equipment but the focus remains on 4G.
