Swedish telecom equipment provider Ericsson won?t share its source code with a security-conscious New Delhi, but is nevertheless confident of arriving at a ?mutually agreeable solution? with it over its concerns in this regard.
Ericsson?s global president & CEO Hans Vestberg told FE in an interview: ?We are trying to cooperate as much as we can with the Indian government to show what we have and what we can do (over the issue of security). We are talking to the government and the idea is to have a balanced approach that would accommodate both security concerns and business objectives.?
Ericsson is the world?s largest telecom equipment manufacturer and accounts for a third of the Indian market. Telecom equipment include base stations, towers and transmitters. The government has raised security concerns over the possibility of embedded malware and spyware in imported telecom equipment.
Vestberg?s statement assumes significance as it comes at the time when vendors have objected to sharing source code citing intellectual property rights. The Prime Minister?s Office had asked DoT whether an alternative mechanism in line with best international practices could be adopted. The DoT has been allotted two months within which it is supposed to work with vendors and suggest alternatives.
Hopeful of an early solution, Vestberg said: ?We are present in over 100 countries across the globe and we haven?t faced such security issues anywhere else.?
Vestberg, while acknowledging the price competitiveness of Chinese vendors, said Ericsson was confident of bagging 3G equipment orders from India. ?We are in discussions with a host of telecom operators but I can?t disclose the names and where our discussions have reached,? he said.
Reliance Communications and Tata Teleservices have placed 3G equipment orders, with the bulk of them going to Chinese vendors. Manufacturers like ZTE and Huawei are giving a tough time to European rivals like Ericsson and Nokia Siemens as their products are 40% cheaper.
Last year, DoT had made it mandatory for telecom operators to procure telecom equipment from outside the country only after giving self-certification on security compliance. However, equipment import from from China and Israel was stalled.
DoT recently issued another order mandating a template to be signed by the vendors and the operators for equipment procurement. It has also been made mandatory for suppliers to share the password and design details with the government and a heavy penalty on telecom operators in case of any security breach.
This template prescribed sharing of source code and imposition of a penalty of Rs 50 crore per purchase order over and above the value of the purchase order. In addition, a penalty of 100% of contract value shall be levied by the government on the operator.