Reliance Industries' 4G gameplan

Mukesh Ambani controlled Reliance Industries' proposed entry into TD-LTE /
4G through the BWA spectrum auction is set to excite the LTE equipment industry in India.

Known for predatory pricing, the Ambanis will be looking at cost effective roll outs across the country. This will put pressure on equipment vendors pricing strategy.

Given the fact, that Reliance had been foremost in the country in coming up with predatory prices in terms of calling rates, handset rates at a time when tariff wars were unheard in the country. The current market which is ripe with opportunities is also throwing many surprises still might have to offer much with RIL entering with full enthusiasm into the telecom space.

Major equipment vendors such as Ericsson, Nokia-Siemens, Alcatel lucent, ZTE, Huawei etc., duly supported by chipmakers such as Qualcomm and ST-Ericsson are already committed to developing
LTE eco-system for service providers and end users in India. Qualcomm and ST-Ericsson are already working on technologies that will allow consumers get access to 3G, GSM and LTE services using a single chipset.

Reliance is keen to share infrastructure with other players. BSNL and Reliance Communications could become potential partners. Infrastructure sharing will help in reducing capex.

Considering the pan-India presence, the broadband mission by Reliance Industries will help in improving the broadband penetration in the country. Reliance Industries will be the only pan India company to offer broadband services in all 22 circles. Aiming at acquiring at 100 million customers within 5 years of launch, the company is now focusing on ushering 'a broadband revolution in the country.

The company will be focusing at offering at diverse data services and rich contents. Commenting on the initiative Mukesh Ambani,CMD, RIL said that, "We see this as the next wave of value creation opportunity in the wireless broadband space. We believe this will pole vault India's economy into the digital world at an accelerated pace while creating next generation tools that will enhance productivity and create world class consumer experience"

Reliance Industries will be deploying 15,000 base stations uptill a cost of $1.5 billion over the next three years. The auction for broadband licenses comes less than a month after a much larger auction for crucial 3G spectrum, which operators need to improve call quality and roll out data intensive services to India's 600 million cell phone users.

Given the enormity of the pricing in the deal, the industry experts assess as to with less revenue potential in the incipient. However, with the involvement of cash rich company like RIL means an tougher competition for telecom firms which are already in tough times due to lower tariffs in voice calls- now the tug of war will also be escalated in the data services.

The government is set to net about Rs 39,000 crore from the auction for broadband wireless which has finally ended on Friday.

archanasi@cybermedia.co.in