RCL to take NextGen services to 38 nations

The Anil Ambani-controlled Reliance Communications (RCL) is poised to ink a host of outsourcing and IP-based managed service contracts in some 38 countries. As part of Reliance-ADA Group's 'NextGen services' strategy, the bouquet of telecom services will be launched by RCL's 100% global arm, Flag Telecom.

Contract details are awaited but Flag 's executive leadership team is learnt to be in pre-sales negotiations with potential overseas clients in Europe, the US, the Middle East and Africa. Commercial rollout of the services, which will pack strong data/video capabilities, is scheduled in January '07.

Confirming the development, a top RCL source told ET: “Flag Telecom's executive leadership which is headed by CEO Punit Garg is engaged in pre-sales negotiations to offer its full-spectrum of outsourcing and IP-based managed services to potential offshore clients in 38 locations.

While tariffs will hinge on a host of factors, key drivers would be size/segment of customer and cost of carrying managed data, which is bound to vary on a case-to-case basis based on client location and data requirement.”

Reliance-ADA Group's focus on the emerging wave of next-generation telecom services comes at a time when RCL's net realisations from services have outstripped net realisations from just raw international bandwidth sales. The focus on maximising global services earnings from IP-based managed and outsourcing services under the Flag banner comes at a time when Flag has just expanded its executive leadership team.

While Mr Garg has been around for several months, the latest member to be inducted is ex-TCS CFO Vinay Aggarwal, who will head the finance function at Flag Telecom. Other key members include Jarret Appleby, senior vice president (marketing & strategy,) who was formerly with MCI-Verizon; Bhaskar Thyagrajan, VP (marketing); Owen Best, senior VP (Asia); and Mark Heraghty, senior VP (Europe, Middle East & Africa).

To what extent the RCL-owned Flag manages to influence the pricing of such managed data/video enabled services in overseas markets, remains to be seen. While international bandwidth pricing is regulated by Trai in India, a host of high-end telecom services in developed markets tend to be market-determined, said an industry source.

The latest developments come on the heels of Flag announcing a whopping $450m of international bandwidth capacity sales within months of the launch of its 10,000-km Falcon undersea cable system in September '06. RCL invested $400m in the Falcon cable which traverses through 11 countries.