IBM logs Bharti's Lanka deal

NEW DELHI: Bharti Airtel, which is set to launch mobile services in Sri Lanka by December, has outsourced all its IT requirements in the island nation to IBM. This implies, the US-based software major, which has been handling all of Bharti���s IT requirements in India, will now continue this relationship to the island nation too. In 2004, Bharti Airtel had signed a 10-year $750 million IT outsourcing deal with IBM, but the value of the contract is now pegged to be over $1.5 billion, making it by far the largest domestic IT arrangement.

Bharti Airtel���s president (mobility) said that IBM would provide IT support for Bharti���s operations in Sri Lanka and also added that this was an extension of the software major���s contract in India. In fact, amongst Bharti���s partners in India, only IBM���s contract extends to new markets that Bharti is expanding to. For instance, while Ericsson and Nokia Siemens are Bharti���s network partners in India, China���s Huawei is building the telco���s infrastructure in Sri Lanka. Similarly, the four BPOs ��� IBM Daksh, MphasiS, TeleTech (acquired by Aegis BPO this year) and Hinduja TMT ��� who handle Bharti���s customer services here will not be involved in the Lankan operations. Mr Kapoor was also confident that Bharti will be able to launch its mobile services by December despite tbeing involved in a bitter war of words with operators there. Bharti has accused the existing mobile players there of ���not providing interconnection to it on the same terms as they practice amongst themselves���.

Interconnection charges apply when any voice or data which originates in the network of one operator is passed on the network of another operator. For instance, if a Bharti customer were to call a customer with Dialog, than Bharti pays an interconnect charge to transit of the traffic.

���This issue is temporarily resolved. All operators have agreed to maintain status quo for the next six months,��� Mr Kapoor said. He also added that Sri Lanka���s Telecommunication Regulatory Authority was working out a new interconnect regime: ���They will be looking at all models such as a system under which the calling party pays or a cost based regime���. Bharti is of the view that mobile tariffs in Sri Lanka will become affordable only if the country were to move towards a Calling Party Pays regime under which customers do not pay for receiving a call.
joji.philip@timesgroup.com