Here are five points that will explain in detail the meaning of hiving off of BSNL's business and what it may lead to:
1. A tower company owns the passive infrastructure and leases it to telecom service providers enabling them to minimise duplication of investments and economise on costs of operation and maintenance, leading to improvement in profitability.
2. Private telecom service operators have created a separate tower subsidiary and have been offering their services, Mr Sinha said. The government allows telecom operators and mobile tower companies to mutually share towers for lowering capital and operational expenses. On the same lines, BSNL, which owns 15 per cent of the 4,42,000 mobile towers in the country, will hive off its mobile towers into a subsidiary company.
3. "We have 66,457 mobile towers. Tenancy ratio was 1.14 was in the past. Average tenancy ratio of other service provider is 1.9. This (separate company) will lead to increase in our tenancy ratio as well. Other service providers will be able to use our towers," the telecom minister added. Tenancy ratio is derived by dividing the number of base stations or antenna installed at mobile towers with the total number of towers.
5. "One thousand six hundred and fourteen people will go on deputation from BSNL and the Department of Telecom. In the coming days, when business will increase, new employment opportunities will be created. This work will be completed in two years," he added. (With Agency Inputs)