(Last Updated On: September 30, 2014)

The Department of Telecom is planning to merge its PSU telecom companies- Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telecom Nigam Limited (MTNL). The merger aims to revive these companies which have been posting losses year after year.

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For the financial year of 2012-13 BSNL posted losses of Rs. 8,198 crore, according to an unaudited report. MTNL, on the other hand, reported a net loss of Rs. 5,321.12 with an annual revenue of Rs. 3,428.6 crore. In a bid to revive BSNL and MTNL, the government has taken proactive measures by waiving off their debts. This includes waiver of financial support of Rs. 6,724.51 crore and Rs. 4,533.97 crore given to BSNL and MTNL respectively when they surrender their broadband spectrum. As a part of this waiver, the Govt. will also wave off a loan given to BSNL amounting to Rs. 1,411 crore.

These companies are also loosing market share due to their inability to expand their coverage caused by financial and instrument procurement issues. Other reasons cited for their decreasing market share are lack of required skill sets due to ever changing technology & the customer centric business model focussing on customer services, marketing, and sales.

According to a source in the DoT, there is no set timeline for the merger but it might be completed within the next 1-2 years.

What would you think would be name of the next PSU telecom company? We are guessing it to be BTNL (Bharat Telecom Nigam Limited).

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