Bharat Sanchar Nigam Ltd has scrapped plans to buy GSM equipment through a 3G-like reverse auction process . The company has instead floated a revised tender with the old system wherein vendors quoting the lowest amount will be selected.
Though the bids will be made online, the telecom major has done a U-turn on its earlier plan to allow equipment vendors to revise its offer through a reverse auction mechanism.
... BSNL insiders suspect that the change may have happened at the request of some of the equipment vendors which feared that a reverse auction could lead to aggressive price cuts by the Chinese players. “In a reverse auction, the vendor with deep pockets and good financing back up, stand to gain as they would be able to cut down on price. While this is good for BSNL in terms of getting the best price it may edge out some of the bigger European vendors out of the play,” said a market watcher.
...BSNL workers' union, meanwhile, has shot off a letter to the Communications and IT Minister, Mr Kapil Sibal, on the issue.
“The present tender for procurement of 14.37 million GSM lines through e-tendering could not reach anywhere for the last more than a year, due to sheer incompetence and extremely poor decision-making capabilities. In the meantime, it decided to float new tender, scrapping auction mechanism. This is simply atrocious, fully exposing professional integrity, very poor understanding on part of management and to top it all its total lack of concern as far as revival of BSNL is concerned,” said Mr G.L. Jogi, General Secretary, Sanchar Nigam Executives Association, in a letter sent to the Minister in October.
Why would the government let this kind of thing continue unless they want to kill off BSNL? Pathetic morons. Nice work by the European vendors too. Nice to watch Capitalism at work.