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Global Footprint
of Videsh Sanchar Nigam Limited
VSNL operates in various geographies, including the USA, Canada, the UK, South Africa, Singapore, Sri Lanka, India, etc.The company has 52
subsidiaries across 21 countries. It carries out its international operations through its subsidiary, VSNL International, which is headquartered in Singapore.VSNL International provides communications solutions to global carrier and enterprise consumers across four continents through its undersea and satellite network infrastructure.The company has established its regional offices in North America, Europe, Asia, and India. Currently, both its US-based acquisitions - Tyco global Network and Teleglobe - have become part of VSNL International.This has helped the company to enter new markets and provide an enhanced portfolio of solutions to its global clients.
VSNL has become the largest provider of submarine cable bandwidth after the acquisition of Teleglobe.With this acquisition, it has extended its global reach to over 240 countries.
VSNL was the first telecommunications company in the world to receive the TL 9000 certification.
In November 2006,VSNL International received the Best Pan-Asian Wholesale Provider award at the 4th Annual Capacity Magazine Global Wholesale Telecommunications Awards in Amsterdam.This award honors leaders in the global wholesale telecom industry.VSNL International also received the Best Wholesale Carrier award at the World Communication
Company Background
Videsh Sanchar Nigam Limited (VSNL) was established in 1986 by the Ministry of
Communications, India, as a public sector enterprise to control and manage overseas communications services. In 2002, the government disinvested its controlling stake and sold its 45 per cent share to the Tata Group. Currently, the government holds a 26 per cent share in the company.
VSNL is India's leading provider of international telecommunications and Internet services.The company provides international switched telecommunications services and value-added services, which include leased lines, dial-up Internet access, satellite mobile telecommunications, video conferencing, electronic data interchange, packet- switched data transmission, managed data network services, e-mail services, etc.The company provides services to its various clients through three
business segments - Wholesale Voice, Enterprise and Carrier Data, and Other Services.
In FY 2006, the company generated revenues of US$ 1,021 million, up from US$ 744 million during the previous year. As on March 31, 2006, the company had a workforce of 4,013 employees, of which 2,926 were employed by the company in India.The company generates its maximum revenues from the Indian market (46.52 per cent), followed by the US market (15.86 per cent).
Globally, the USA and the UK contribute approximately 23.5 per cent to the company's total revenues.
VIDESH SANCHAR NIGAM LIMITED
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125 Virtual Private Network (VPN) services.This
acquisition has helped VSNL to access Gemplex's assets and its markets in the USA, Europe and the Far East. Further, the company has entered into contracts with five major IT-enabled services clients, which utilize IP-VPN for their voice and data operations in the USA.
Tyco Global Network, USA
In November 2004,VSNL acquired the US-based Tyco Global Network with one of the most advanced and far-reaching submarine cable systems in the world, spanning 60,000 km across three continents - North America, Europe, and Asia.
With this acquisition,VSNL took control of this network, a network operating center, 30 global points of presence, and 12 gateway city
connectivities.This acquisition has also helped the company to provide personalised, robust, end-to- end telecommunications solutions to its enterprise and carrier customers.
TeleGlobe International Holdings
In February 2006,VSNL acquired Teleglobe International Holdings (Teleglobe), which is headquartered in Hamilton, Bermuda (USA).
Teleglobe provides international
telecommunications services, including voice, data, Internet protocol, and mobile signaling services.This acquisition made VSNL one of the largest global carriers of voice data.With this acquisition,VSNL has also gained access to
Teleglobe's global network spanning 240 countries and territories, with advanced voice, data, and signaling capabilities in more than 80 sub-sea and terrestrial cables. It enabled the company to gain access to over 200 direct and bilateral agreements with leading voice carriers, some of which are international service providers.The acquisition has also helped the company in emerging as one of the leading providers of wholesale voice, bandwidth, and enterprise data services.
Awards (WCA) held in 2006.The award honors companies ushering in innovations, scaling new heights and offering new services for the
development of the telecommunications industry.
Videsh Sanchar Nigam Limited in the United States of America
Mode of Operation
The company operates in the USA through its subsidiaries VSNL America Inc,Teleglobe America Inc, and VSNL International (US) Inc.
Overview
VSNL began operations in the USA in 2003 by establishing a subsidiary,VSNL America Inc.The company provides IP-VPN solutions in the USA.
The company has expanded its operations by acquiring several international telecommunications companies with US-based operations. It was the first Indian public sector company to enlist its ADRs on the New York Stock Exchange.
Currently, the company employs 281 personnel in the USA through its US subsidiaries.
VSNL's Acquisitions in the United States of America
Gemplex, USA
In July 2003,VSNL America Inc. acquired US-based Gemplex, which provides IP-based international
Source: Annual Report
VSNL’s revenues from the United States of America
2003-04 2004-05 2005-06
0 50 100 150 200
Year
US$ million
113
75
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five international gateway switches, and 21 national long-distance switches worldwide. It has over 50 earth stations and terrestrial cable systems, with 200,000 km of fiber and cable, 275 points of presence in 25 countries, and access to five geo- stationary satellites and seven data centers globally.
The company offers high-end services to its clients by successfully leveraging its infrastructure.
Financial Backup
VSNL receives strong support from the US$ 22 billion Tata Group.This has provided the company with the necessary financial advantage to pursue its global acquisition drive. It acquired Gemplex for an undisclosed amount,Tyco Global Network (TGN) for US$ 120 million and Teleglobe for US$ 178 million, enabling it to diversify its business in the USA and abroad.
Future Plans
VSNL plans to expand both its domestic and global reach, for which it plans to expand its product portfolio into managed services and IT solutions.
The company is also looking for potential acquisitions to fuel its future growth.
Upgrading its Submarine Cable Systems Considering the increasing demand for
telecommunication services between Asia and the USA,VSNL is planning to upgrade its Trans-Pacific submarine cable network. Its capacity is expected to rise to 1 tbps.This submarine cable network connects Internet and carrier exchanges in the USA to those in Japan and other Asian destinations.
In addition,VSNL is planning to construct a new submarine cable system linking Singapore, Hong Kong, and Japan for its customers in the Asia Pacific.This intra-Asian cable, along with the TGN-Pacific and Tata Indicom cable system, will complete VSNL's network from India to Asia, and extend it further to the USA.
Success Factors
Wide Range of Services
VSNL provides a wide range of services, including international telecommunications services and value- added services such as international leased lines, dial-up Internet access, international satellite mobile telecommunications, video conferencing, electronic data interchange, packet-switched data transmission, managed data network services, e-mail services, and virtual private network services.The company continuously offers new products and services, which include corporate Internet telephony,VoIP, and bandwidth-on-demand. It has emerged as one of the leading providers of enterprise services, carrier value-added data, broadband and wholesale services.The company's large product and service portfolio enables it to serve its clients effectively.
Strategic Acquisitions
VSNL acquired three US-based companies, including Gemplex,Tyco Global Network, and TeleGlobe International Holdings, which later became a part of VSNL International.These acquisitions were instrumental in VSNL's success because they helped the company in enhancing its portfolio of services, increasing its number of clients, and expanding its presence to new markets.
With these acquisitions, the company has become one of the leading wholesale voice providers in the world, managing the largest international network that spans 240 countries and territories. Further, the company has acquired access to a submarine cable system spanning three continents, which has helped it to provide end-to-end
telecommunications solutions to its enterprise and carrier customers.
World-Class Infrastructure
Strong global infrastructure, along with multiple connectivity options, is one of the major factors contributing to the company's success in international markets. It operates 26 switches,
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