Bharat Sanchar Nigam Limited
(A Government of India Enterprise)
148-B, Statesman House, Barakhamba Road,
New Delhi-110001
(CMTS INFRA CELL)
No. 61-39/2008-CMTS-Infra Dated: 06.05.2009
To,
The Chief General Manager Telecom,
All Telecom Circles/Telecom Districts,
Subject: Policy for leasing out BSNL's passive infrastructure (GBT Towers) to other
telecom service providers - revision thereof
Sir,
Kindly refer to this office letter of even no. dated 16/01/2009 wherein policy guidelines for leasing out BSNL's passive infrastructure (GBT Towers) to other telecom service providers were announced. In accordance with the market based pricing approach and in supersession to all earlier letters on the subject, the revised policy/guidelines are hereby issued as under:
1. BSNL shall lease out the passive infrastructure (GBT sites only) at BSNL and Non-BSNL sites, having spare capacity/slots, to other service providers. The passive infrastructure elements include tower space for mounting antennas for a BTS and microwave (if required for backhaul for the same BTS) and also the associated passive equipments such as shelter/room, DG, power plant, air conditioner, earthing and battery bank.
2. The Heads of Circles shall assess their own requirements of Ground Based Tower (GBT) infrastructure sites for immediate rollout of all types of wireless services and find out the spare capacities/slots which can be spared for leasing to other operators.
3. For leasing out towers at Non-BSNL sites, the Heads of Circles may get the lease agreements of the hired sites (lands/buildings) suitably modified, if required, wherever spare slots are available for leasing out to private operators.
4. The CGMs may also consider the swapping of the available spare capacities/slots on 1 to 1 basis with other service providers without involving any payment obligations to each other to meet BSNL's additional requirements of infrastructure with a view to achieve faster rollout of its services. 1 to 1 swapping of infra sites with other service providers must be done judiciously keeping in mind the importance of sites to be swapped.
5. BSNL shall charge a base rental of Rs. 35,000 per month for all its BTS sites that it shares for first external tenant. BSNL shall progressively provide 10% discount on the running contract price to all existing external tenants for addition of every external tenant. The base rental also includes charges for security being provided by BSNL, if any. It may kindly be noted that for this purpose BSNL should be considered as first tenant on its shareable towers (irrespective of number of slots occupied by BSNL). Any operator other than BSNL, who will share tower of BSNL will be second tenant but will be termed as first external tenant.
6. The above base rental shall include Rs. 5,000 as absorbed land rental. As a result, BSNL shall charge any additional land rental (over and above Rs. 5,000 on an actual, as incurred basis) for a particular tower site to all external tenants on a proportional basis. In case there are additional out-of-pocket expenses for BSNL (on sites where the land is not owned by BSNL), an appropriate portion of the out-of-pocket expenses shall be factored in while calculating rental for external tenant.
7. BSNL shall price its towers in six price distinct categories: A-1, A, B-1, B-2, C and Rural analogous to the six classifications of the cities as per Annexure-I.
8. BSNL shall charge a premium on the base rentals for towers located in different class of cities in the following manner:
Class of Cities Premium on base rates
A-1 25%
A 20%
B-1 10%
B-2 5%
C Nil
Rural Nil
9. The rates as above will hold for a period of 15 years from the time of commencement of the Passive Infrastructure Sharing, subject to an annual escalation of 2.5% year over year. Lock-in period for a leased out infra site shall be 10 years with an option to renew on an annual basis thereon.
10. BSNL shall give volume based discounts on the BTS slots that it shares. It shall give 2% discount on contracted rental for all shared BTS slots by a tenant, if a tenant hires more than 500 BTS slots (cumulatively at any point in time). This discount shall be increased to 4% discount on contracted rental for all shared BTS slots by a tenant, if it hires more that 1,000 BTS slots (cumulatively at any point in time) and 6% discount on contracted rentals for all shared BTS slots by a tenant if the number of BTS slots hired by the tenant is more than 2,000 (cumulatively at any point in time). The applicability of specific discounts, stipulated above, shall be from the next month from the month in which the said volume is achieved.
11. BSNL shall charge all energy costs (including diesel and electricity charges), on actual, as a pass-through expense to tenants (charges to be divided proportional to tenancy on the tower). Methodology of sharing of energy charges (sharing of electricity bill and diesel expenditure) are to be decided by the CGMs in consultation with electrical wing by conducting a standard test at each site in the presence of the representative(s) of the tenant(s).
12. BSNL will have the authority to re-negotiate terms and conditions of passive infra sharing with tenant if there is a substantive change in the ownership structure of the tenant.
13. The tenant, under no condition, will sublet the BTS slot that it has rented from BSNL.
14. Tenant’s exit during the lock-in period will carry a significant penalty. If the tenant exits the BTS slot before 7 years from the time of commencement of the Sharing, it will be liable to pay BSNL the sum of all unpaid future base rental payments till 7 years from the date of commencement of the Sharing and 50% of the future rental payable after year 7 to year 10 from the date of commencement of the Sharing. Tenant’s exit from the BTS slot after 7 years from the date of commencement of the Sharing (and before expiry of the lock-in period) will imply liability of 50% of all future base rental payments till 10 years from the date of commencement of the sharing.
15. BSNL shall charge base rentals on an advance payment basis at the start of every month.
16. Diesel & Electricity charges shall be collected as an advance from the tenant at the start of every month. The actual receipts shall be submitted every quarter for adjustments.
17. An advance security deposit of Rs 5 lacs, (in the form of BG valid for a period of three years and renewable in steps of three years) will be taken from the each external tenant for each leased out site with 5 crores as the maximum limit of the bank guarantee for each circle. The amount of BG for pan India leasing will be Rs 25 crore.
18. If the date of commencement of lease period does not coincide with 1st date of any month, proportionate charges shall be applicable.
19. Applicable Taxes/surcharges shall be charged extra.
20. Assured Uptime and Outage penalties: BSNL shall ensure 98% power uptime measured for a site on quarterly basis. In case, cumulative down time of a particular site over a period of one quarter exceeds the permissible limits of down time i.e 98%, the downtime beyond 2% should will be compensated by giving a rebate of Rs 100 per hour subject to a limit of Rs 5000 per month in the monthly rental bill for the first month of the next quarter for that particular site.
21. To facilitate the circles to take proactive action, the Heads of Circles are hereby authorized for the following :
(a) Form a separate group at circle level exclusively for the purpose of expeditious up-gradation and leasing of BSNL’s passive infrastructure sites to other service providers.
(b) To take further steps as may be needed to maximize the leasing of the BSNL’s towers and thus maximizing the revenue for BSNL.
(c) To upgrade the passive infrastructure elements of shareable towers such as battery, power plant, DG set, shelter/space, etc. However, prior to actual up-gradation of the passive infra elements of the sharable sites, the circles should take the following advance planning steps:
(i) Preparation of database of existing infrastructure (tower, battery, power plant, DG, space, media, etc) for shareable sites.
(ii) Immediate action to get all the faulty equipments (battery cells, power plant modules, DG & its battery, etc) of the infrastructure sites, attended for utilization of the equipments up to its rated capacity and to ensure uninterrupted services to our own subscribers as well as to maintain 98% power uptime for the external tenant.
(iii) Identification of tenancy which each of these sites can support with existing infrastructure.
(iv) Identification of up-gradation requirement, if any, for sharable sites to support additional tenancies.
(v) Upgradation of the sharable sites on receipt of firm service order from the service provider.
22. The following key steps are to be followed during the sharing process:
• To provide information of sharable towers to the enlisted service providers.
• Based on the confirmation, the service providers issue a ‘Service Order’ to BSNL.
• BSNL issues a ready for active installation clearance to the service providers.
It is, therefore, requested that the Heads of Circles may kindly take necessary proactive action in this regard to generate additional revenue and inform this office about the progress on monthly basis through fax on no. 011-23785238 positively.
This is issued with the approval of competent authority.
(Sudhir Gupta)
DGM (CMTS Infra-I)
Phone- 011-23766989
Copy to
1. OSD to CMD BSNL
2. All Directors of BSNL Board.
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