Close on the hills of losing the leadership position in mobile telephony to Ncell, state-owned Nepal Telecom (NT) is on the brink of a serious crisis -- it may run out of available GSM lines by mid-November.
That would mean no new NT SIM will be available in the market. More than the revenue, it can seriously impair its image and brand value.
Managing Director of NT Bishow Nath Goyal said the telecom has no alternatives. "If the ´bridging project´ is not implemented timely, we will not have GSM SIM cards to distribute after October," Goyal told Republica.
The planned new project of 10 million GSM lines is going to take as long as 20 months to be completed. "We are calling a global tender shortly for the project. But since this is a big project, it will take 16-20 months," said Goyal, adding that PAC should allow it to go ahead with the bridging-project as there is no option to bridge the gap. The 10 million GSM lines have been planned keeping in mind demand in the the market till 2015.
As NT´s bridging-project has already landed in controversy inviting a probe by the Parliamentary Accounts Committe (PAC), there is no hope in sight for NT. The bridging-project aims to ensure supply of mobile lines in the intermittant period till NT puts in place necessary arrangements for more CDMA and GSM lines and the project was given to Chinese company ZTE without inviting a tender, a fact PAC finds unacceptable.
However, Goyal said the idea of bridging-project was to bridge the gap till the big projects come into effect. NT was planning to bring bridging into effect in next four months so that it could supply GSM and CDMA lines without any fear of short supply.
On an average, NT requires 200,000 SIM cards a month and it has the stock barely to last three months. According to NT officials, the operator has only 520,000 GSM lines and 156,000 CDMA lines remaining in the stock.
NT´s bridging-project, under which it decided to add 1.15 million GSM lines and 400,000 IP CDMA lines, hit a snag mainly as PAC charged NT with bypassing the procurement procedure. The work was given to ZTE, calling the new development a continuation of the previous project for which tender was awarded to ZTE.
This is certain to delay the procedure. If PAC finds more wrongdoings by the NT management in the matter, it will put NT in a ridiculous situation in which it is not able to supply mere SIM cards in the market, forget wresting its leadership position through better marketing strategy.
The regulator Nepal Telecommunication Authority (NTA) is apparently at a loss to offer any practical way-out of this messy situation and is content with cursing NT management. "The emotional blackmail measures won´t add up to anything without fulfilling the procedural requirements," an NTA official said.
However, the official said a timely decision on the part of PAC is must for the operator to save its face and compete against private operators.
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