Wireless Milestone

The last mile connectivity is one of the biggest hurdles in

rolling out connectivity across the country. Going the wireless way, Tulip IT

Services established one of the most effective alternate options to copper, to

bridge this last mile gap. After effectively tapping the corporate market

segment for its connectivity offering, the company is now also exploring the

outsourcing opportunity by tapping the carrier market for leasing out its last

mile wireless network.

With its IPO round the corner, whereby it plans to raise Rs 60

crore, Tulip is also in the process of outlining its expansion strategy that

will include furthering its connectivity network beyond the present around 220

locations even while more optimally covering these existing locations. Wireless

has been identified as the growth area, and the company targets almost 50-60% of

its total business from this segment by the end of this year.

On exploring the last mile leasing out model, Lt Col HS Bedi,

managing director, Tulip IT Services, says that no telco has the infrastructure

that can do everything and, hence, more and more telcos will go the way of

outsourcing their last mile connectivity requirement. "Today's business

and market environment requires us to share each other's resources," he

adds. Tulip is already taking the inter-city fibre on lease from the various

carriers and then creating its own wireless network for the last mile to be able

to provide end-to-end connectivity to its corporate customers.

"Today's business and market environment requires us to share each other's resources" Lt Col HS Bedi, managing director, Tulip IT Services

Tulip is reported to be already leasing the last mile wireless

connectivity to one of the top three carriers in the country, which it won

around 4 months back. It is presently in talks with various carriers, both

national and smaller local carriers for a similar arrangement. Tulip is in

advanced stages of talks with another big national carrier and is expected to

rope it in the next one month. The company is expecting its business model to

fetch around 25% of its connectivity business by the year-end.

Commenting on the type of arrangement that will be there with

the carriers, Lt Col Bedi says it will be based on commercial arrangements under

which infrastructure sharing will be done and there will be bandwidth based

charging.

Tulip will be riding on the USP of its extensive coverage across

220 locations. It is planning to further expand its locations coverage to more

than double in the next 2-3 years. According to Lt Col Bedi, all major cities

have already been covered and the coverage in the smaller towns and cities will

now be at a faster pace, as installation of one base station will help in

covering almost the entire town.

While expanding the number of locations, the company is also

targeting to make the coverage more dense within the existing 220 locations. One

of the areas that it will be investing in will be scaling up to MPLS right up to

the last pop in these locations that have already been covered. This is expected

to happen after funds are raised from the IPO.

A Closer Look

• Rs 60 crore IPO on the way, to fund expansion

• Lowering focus on services business including facility
  
  management, network management and security services

• Main growth to be in the connectivity business

• Urban connectivity revenues worth Rs 250 crore in 2005-2006

• Wireless identified as the leading growth driver

Shipra Arora