Vsnl To Invest $300 Mn On India-europe Undersea Cable

[leomax]

Tatas-owned Videsh Sanchar Nigam Limited plans to lay an undersea cable between India and Europe, covering about 10,000 km, at an investment of over $300 million.

Senior VSNL officials confirmed the plan and said that the company was expecting to have enough demand for bandwidth by 2008 and keeping this in mind VSNL has undertaken the major project.

Since the cost involved is huge, the company is also discussing with a few companies in West Asia to share the expenditure.

The partnership could be in any form -- the companies may take capacity and become financial partners, the officials said.

VSNL is in talks with Etisalat of United Arab Emirates and Saudi Telecom of Saudi Arabia, besides a few others in Southern Europe.

The cable is likely to be laid from Mumbai passing through Gulf and Egypt to France or Portugal.

The company is in the process of preparing a project report and by August/September the blue-print is expected to be ready, they added.

Asked about the source of funding, sources said it would be partially from internal accruals and rest depends upon the response from other partners.

VSNL is talking with the vendors about the costing to tie up finances, sources said.

Asked about the demand for undersea terabyte cable, VSNL officials said there would be enough demand for bandwidth in India itself as it has become a big destination for IT and enabled services.

VSNL, claiming to have a broadband subscriber base of over one lakh, said broadband is coming up in India in a big way and this alone would generate sufficient demand for bandwidth, they added.

News from Rediff
News from ecnomic times

 

[vshs]

lets see when we get benifit of the undersea cablethanks

 

[blr_p]

Capacity = terrabyte ?Cost = $300mnbSNL annual profits = $10bnAvalilable = 2008unlimited internet = hopefully much sooner 🙂

 

[netfreak]

QUOTE(blr_p @ May 2 2006, 06:58 PM) [snapback]50020[/snapback]
bSNL annual profits = $10bn
[/b]

$10bn... thats an eye opener... 😱 😱 😱

Are you sure??

 

[leomax]

That was an eye opener for me too 😱 http://economictimes.indiatimes.com/articleshow/1484507.cms

Anyone remembering the news(or was that a rumour) that bsnl is going to have thier own fiber to singapore by 2007/8?

We want low pinging networks to europe,we can get enough connectivity to north america through east and west,but the one that we really lack connectivity is to europe imo,especially considering amsterdam IX broke the 100Gbps barrier and they are the one of the largest (most largest?)

 

[netfreak]

Just checked that link, its not $10bn BSNL's profit was INR 10 bn. $10 bn profit would have made it a Fortune 100 company..

 

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[vshs]

that comes to nearly 2 billion dollars thanks

 

[netfreak]

Still pretty impressive... a govt owned company making ~$2 bn per year is a welcome surprise.

 

[Sushubh]

ur forgetting abt ONGC and other oil companies. bsnl does not subsidize their offers to the indian customers... the oil companies lose crores of rupees everyday... 😉

 

[netfreak]

What is surprising here is profit of BSNL as compared to other telecom giants. E.g. AT&T's profit was $4bn and BSNL's profit is $2 bn. Normally I would not have thought BSNL to be in AT&T's league in terms on comp ratios. Similarly if you compare ONGC to Big comanies (e.g. Exxon) comps are not so impressive.Revenue numbers are:ONGC - ~$10 bn (~$2bn profit)Exxon - ~$370 bn (~$36bn profit)

 

[leomax]

Indeed thats an impressive profit a state owned firm,but they're hardly doing anything good from that to customers,arent they?they want more profits than a satisfied customer ..... sigh

 

[Sushubh]

QUOTE(netfreak @ May 3 2006, 12:10 PM) [snapback]50102[/snapback]
What is surprising here is profit of BSNL as compared to other telecom giants.

E.g. AT&T's profit was $4bn and BSNL's profit is $2 bn.

Normally I would not have thought BSNL to be in AT&T's league in terms on comp ratios.

Similarly if you compare ONGC to Big comanies (e.g. Exxon) comps are not so impressive.

Revenue numbers are:

ONGC - ~$10 bn (~$2bn profit)
Exxon - ~$370 bn (~$36bn profit)
[/b]



what if they are not owned by the governmetn and can actually take competitive decisions to challenge other private players and not supposed to pay for stupid schemes started by the governmetn to generate votes for their next elections! 🙂

they pay for the price we dont pay on petrol, diesel, kerosene and LPG. 😀

 

[blr_p]

AT&T is one of the baby bells, broken up from the big Bell telephone company. Who do you think paid for the initial roll out to the country decades ago, mostly subsidised by the govt. Also AT&T does not operate solely in the US, its a multinational. BSNL or VSNL AFAIK is mostly domestic.Oil in the US is one of the few countries apart from the gulf where import tax is not charged. The price at the pumps is a true reflection of what the going price is. They are not being protected atm like we are, but then we did not have the benefit of cheaper prices when it really was cheaper than it is now.

 

[Sushubh]

and now they are planning to increase it by as much as 7 (though i doubt the hike would be this big)...damn, my swift gives me 10 kmpl!

 

[netfreak]

QUOTE(Sushubh @ May 3 2006, 12:33 PM) [snapback]50106[/snapback]
what if they are not owned by the governmetn and can actually take competitive decisions to challenge other private players and not supposed to pay for stupid schemes started by the governmetn to generate votes for their next elections! 🙂

they pay for the price we dont pay on petrol, diesel, kerosene and LPG. 😀
[/b]
Compare that with Reliance... its selling Petrol/Diesel at nearly the same price (at least in Mumbai) and it does make a profit, have a look at BSE or NSE data submitted by reliance on petrochemicals.

Even for ONGC, its profit is 20% of revenue ($2bn profit with ~10bn revenue) while Exxon's margin is half of that (~ 10%).

My point is, even with load of subsidies 20% margin is not bad at all.

QUOTE(blr_p @ May 3 2006, 12:56 PM) [snapback]50110[/snapback]
AT&T is one of the baby bells, broken up from the big Bell telephone company. Who do you think paid for the initial roll out to the country decades ago, mostly subsidised by the govt. Also AT&T does not operate solely in the US, its a multinational. BSNL or VSNL AFAIK is mostly domestic.
[/b]
I agree that BSNL and AT&T at not playing at the same level.

My point was, I did not expect profit numbers of these companies to be in the same range and this fact was a welcome surprice.

BTW... these smaller bells are now operating as a single entity again.
Long story short, SBC acquired some of Bell companies, then acquired AT&T itself and change its own name to AT&T.
$101bn At&T as of now, is the biggest telecom company (with Verizon at close second at $96bn), based on yesterday's NYSE data.