Idea Cellular has reportedly entered a $500 million network expansion contract with Nokia Siemens.

In a statement, the two companies said that under the contract, Nokia Siemens Network will expand Idea Cellular's GSM/GPRS/EDGE networks to cover population centres across six circles of Delhi, Haryana, Uttar Pradesh (East), Uttar Pradesh (West), Andhra Pradesh, and Kerala.

Since completion of the Nokia Networks-Siemens Communications merger on April 1st this year, this is the merged identity's first contract in the country.

Sanjeev Aga, Managing Director of Idea Cellular, said the contract will allow Idea to expand reach to 6,000 new centres in addition to the existing ones.

Ashish Chowdhary, Head of Nokia Siemens India Sub Region, said deployment of products and technology would be done in India as soon as they are globally launched.

The deal covers supply and services of GSM equipment, intelligent network, value-added services, and circuit packet core equipment, Chowdhary said.

Under the deal, Nokia Siemens will provide flexi base transceiver stations, mini-ultra base stations, Release 4 architecture, media gateways, and MSS servers.

Nokia is known as the largest managed service provider for aggressively expanding mobile phone networks. For Bharti Airtel, it manages 8 circles, and 19 circles for Hutch, now controlled by Vodafone.

As regards roll-out of cellular services in Mumbai, Aga said Idea has started project work. However, final launch would depend on allocation of spectrum.

Apart from Mumbai, Idea has bagged license for operations in Bihar. The company plans to expand its footprint to 13 circles across the country.

The Nokia Siemens-Idea Cellular contract is the latest instance of big-ticket contracts, wherein telephone service operators focus on customer management while core network functions are left to outside partners.

For Idea Cellular this is a win-win. In February this year, the company inked a three-year contract with Swedish equipment giant, Ericsson, for GSM expansion in Maharashtra, Gujarat, Rajasthan, Madhya Pradesh, and Himachal Pradesh telecom circles. Wherein, Ericsson is providing radio access, microwave transmission and Gen-Next mobile softswitch network achitecture to Idea.