On 23 July, executives from Samsung Electronics met with the top executives of Bharat Sanchar Nigam Limited (BSNL). Its pitch to the state-owned telecom operator, which is in the process of setting up a pan-country 4G network, was simple—you have a $1 billion opportunity for telecom equipment vendors, we’re the right company for the job.
To make a case for the South Korean electronics major, Samsung executives used a ten-slide deck, which The Ken accessed. It highlighted the futility of continuing legacy 2G and 3G networks. Instead, Samsung encouraged
BSNL's pinning its hopes for an indigenous 4G network on Indian software majors like Tech Mahindra, HCL, and TCS
to redirect all proposed investments to 4G
Long Term Evolution
It is a standard for wireless broadband communication
networks. It even handed over a strategy, sourced from a global consulting firm, to transition subscribers to 4G.
The thoroughness of Samsung’s pitch was matched only by its urgency. For Samsung, securing the BSNL contract could be critical to the future of its networks business in India.
The Seoul-headquartered company set sail in India’s telecom infrastructure seas almost a decade ago; its vessel, telecom operator Reliance Jio, which was more concept than telco at the time. Now, though, its voyage with Jio could be at an end. Having built Jio’s 4G LTE network from the ground up, it has seen its role diminished as the telco’s spend on 4G network building is largely complete.
The two companies were locked in an eight-year exclusive contract, which would end in 2020. But in 2019, this was extended by three years, sans an exclusivity clause. With its Jio charter possibly winding to its conclusion, Samsung is on the hunt for its next Indian expedition. The question now is whether it will once again find a partner in Jio or decide to forge a new alliance.
Even as it hedges its bets, looking beyond Jio, the experience it garnered building the telco’s network has set it up nicely for its next chapter. Before Jio, Samsung was largely unproven when it came to deploying networks outside its home country. Building a vast network for Jio’s 400 million subscribers, though, gives it a solid base to pitch to other telecom operators.
Samsung saw its overall Indian revenue grow by nearly 20% between the year ended March 2018 and March 2019—from Rs 61,056 crore (~$8.1 billion) to Rs 73,085 crore (~$9.7 billion). Mobile handsets and other consumer electronics remain its bread and butter in the country.