Indian MTNL eyes managed services deals in Africa

Indian state-run MTNL, which operates mobile and landline services in Indian mega cities like Mumbai and Delhi, is diversifying its business into the managed services space in international markets. In the beginning, it is about to ink multi-year managed services deals with mobile phone companies in key African markets like Zambia, Zimbabwe, Cameroon, Djibouti and Mozambique, a top company executive told to Economic Times of India.

MTNL will handle network management, up gradation, planning and maintenance for GSM technology service operators in Africa and will also be responsible for the upkeep of key performance indicators and service level agreements. It will also assist  African operator clients on vendor selection to get the best deals.

Mahanagar Telephone Mauritius Ltd (MTML), MTNL's subsidiary based in Muaritius, will be responsible to execute African operations. The parent company is about to relocate 100 top engineers and consultants from Mumbai and Delhi to Mauritius to anchor these managed services deals in Africa. "The MTNL board has taken a decision to dedicate people resources to enter the lucrative managed services space in key African markets. We are in talks with some of the biggest telcos in Zambia, Zimbabwe, Cameroon and Djibouti to offer managed services," said another MTNL executive who declined to named these companies.

MTNL itself does not plan to launch GSM services in Africa since losses have mounted and it is in no position to invest in excess of $100 million in greenfield network rollouts. "We don't have money to roll out greenfield networks in Africa. The decision to get into managed services is aimed at prising open new revenue streams since MTNL has the necessary engineering resources to manage international mobile networks," said a company executive.

The size of the managed service contracts is not disclosed but it is expected that multi-year deal in these African markets was likely to be benchmarked at roughly $20 million (Rs 100 crore) a year.

The MTNL leadership was recently in Mauritius to finalise the telco's African odyssey.

This will be MTNL's second attempt to enter Africa. It failed to bag a mobile permit in Kenya in 2006 and a year later it failed to buy a controlling stake in Telkom Kenya. At present, the telco operates mobile services on the GSM and CDMA platforms in Mauritius and will launch 3G services in the island by November.