India's state-owned MTNL has dropped plans to hand over the management of its 3G network in Mumbai and Delhi to Virgin Mobile and Spice Group. Local media reported mixed reasons for canceling the outsourcing deal - ranging from government pressure to internal politics at the company.
MTNL's chairman and managing director Kuldeep Singh confirmed the cancellation of the tender to the Economic Times newspaper. "We may issue a fresh tender after government approval. We are still open to the concept of outsourcing our 3G networks," he said.
MTNL was seeking an outside partner to take over the running of its 3G networks in Delhi and Mumbai after the company reported appalling levels of subscriber uptake with just 1,000 customers after six months of operations. However, since the tender was announced, the company has seen a surge in subscribers and has signed up some 35,000 customers in the past five months.
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