Alcatel-Lucent, Reliance in talks for broadband

NEW DELHI, INDIA: Telecom equipment maker Alcatel-Lucent is in talks with companies including India's Reliance Industries to supply broadband equipment, a senior company official said on Wednesday.

Alcatel-Lucent expects the first set of broadband gear orders to come in early 2011, Munish Seth, the newly appointed country head for the company's Indian business, told reporters.

"We are in initial level of talks with most of the people who have won the spectrum," he said. These included India's largest listed conglomerate, Reliance Industries, and Tikona Digital Networks, he said.

Firms including India's top mobile firm, Bharti Airtel,  No. 2 Reliance Communications, Vodafone, Tata Teleservices and Idea Cellular spent a combined $23 billion to grab licences in recent auctions of 3G and broadband wireless radio airwaves in the fastest-growing cellular market.

Reliance Industries, controlled by billionaire Mukesh Ambani, made a dramatic return to the telecom business with the $1 billion acquisition of Infotel Broadband, the only company to win a nationwide licence for broadband wireless spectrum in the government auction.

Reliance Industries plans to invest about $5 billion in the venture over the next two years.

Alcatel-Lucent has been present in India since 1982 and supplies telecoms gear to India's GSM and CDMA network operators.

The company has separate joint ventures with Bharti Airtel and Reliance Communications to manage their networks.

Alcatel-Lucent is considering setting up its global services headquarters in India and will take a decision in the near future, Chief Executive Ben Verwaayen had said in June.

The global services headquarters would need about $500 million in investments over three years, he had said.

Regulation Concerns

Last month, India tightened rules for telecom gear imports saying vendors must allow inspection of their equipment and made carriers solely responsible for the security of their networks, addressing security worries that had led to restrictions on Chinese manufacturers.

"We have concerns about some of the regulations that have been suggested," Rajeev Singh Molares, Alcatel-Lucent's president for the APAC region, said on Wednesday.

The company is working with the Indian government to resolve the concerns, he said. "We are confident that those concerns would be resolved," Molares said.

He declined to elaborate on what the concerns were, and did not comment on whether equipment orders were stalled because of the tightened rules.