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|October 24, 1997||
A+ for AsiaEven as British Telecom awaits a decision on its bid to tie up with the Videsh Sanchar Nigam Limited for its grand hubbing plans, Richard Slogrove, BT's director for global marketing, has declared "Asia is the jewel in the crown, the ultimate corporate prize."
Asia is at the heart of BT's global strategy. Slogrove points out that BT has covered 85 per cent of Europe with a series of joint ventures and has covered the Americas with the MCI alliance. Yet, in Asia, China alone is like several Western countries and Australasia is a £ 13.4 billion ($21.7 billion) a
BT is to invest $2-2.5 billion over the next five years in Asia. And the focus will be on five clearly defined regional players: China, South Korea, Singapore, Malaysia and India.
In India, BT is among the first global companies to have seen the country's software potential, Slogrove claims. He points out that BT has had a presence in the 'very small aperture terminals' or VSAT satellite communications market besides owning a licence to do the cellular phone business in Delhi.
BT and Mahindra and Mahindra Limited are partners in software venture Mahindra-BT Limited. BT and Bharti Telecom Limited are partners in Delhi mobile phone company Bharti Cellular Limited and VSAT venture Bharti-BT Limited.
Its largest project in India, a $440-million joint venture with state-run VSNL, for a hub to carry international voice, data and video traffic was rejected by the government and put up for open bidding.
Now global telecom majors, including BT-MCI, Global One Consortium, Telstra, Cable & Wireless, TeleGlobe USA, Hutchison and North American Gateway (Canada) have presented their bids for the VSNL regional hub project in Bombay.
Prominent among the names on the regrets list are KDD, NTT, PTT Netherlands and Singapore Telecom. The surprise, perhaps, is the fact that AT&T figures neither in the bidders list nor in that of those who sent in regrets.
Significantly, AT&T is one of the companies, instrumental in getting VSNL to back off from the joint-venture with BT-MCI and opening up the project to bidding.
The evaluation committee, comprising three officials of the Department of Telecommunications and one from the Videsh Sanchar Nigam Limited, will arrive at a decision in 4-6 weeks.
Five criteria for evaluating the bid proposals have also been announced. These include: strategic vision; financial health of the company and other financial parameters; technical and marketing expertise; international connectivity and commitment to India. The weight that each of these criteria will carry has not yet been decided.
Despite the recent setback to the BT-MCI merger, with GTE making a fresh bid of $32.5 billion cash/debt for MCI, the two telecom majors stand by each other and have jointly presented a bid for the VSNL project. This is an indication of the BT-MCI consortium's commitment to India, BT officers claim.
"We have to be in China but we are not permitted to go into China as an operator. But there are opportunities. We are a state monopoly that became a global warrior. People want our knowledge," Slogrove claims.
While everybody else is trying to attack the market, BT and the Chinese authorities could work together to address opportunities, maybe outside China, he hoped.
In South Korea, BT is in negotiations with a local partner to become a challenger to the incumbent state-run Korea Telecom Corp, Slogrove says. "As a challenger, you can't really be just a fixed-line operator. You need the whole gamut of services and that's what we are going after in Korea."
In Singapore, BT is bidding with Nippon Telephone and Telegraph Corp, Singapore Technologies Industrial Corp and state-owned Singapore Telecommunications.
In Malaysia, BT is trying to win some of the flagship projects for the Multimedia Super Corridor. "We might consider providing telemedicine there, by partnering with a healthcare company," he says.
A BT spokesperson said the Asia strategy stems from the fact that telecommunications growth in the region in 1996 was 68 per cent as compared to 13 per cent in the US and 36 per cent in Europe.
"Asia is expected to grow by between 50-60 per cent a year until 2000. This will make it the largest telecommunications market in the world," concludes Slogrove.
- Compiled from the Indian media
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