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RIL Will Not Partner With R-Com For 4G Services; Plans To Make Mobile Handsets: Report

Contrary to earlier reports that had indicated that Mukesh Ambani owned Reliance Industries Ltd (RIL) would partner with Reliance Communications, a part of the ADA Group for its 4G rollout, its towers and pan-India fibre optic network, a senior RIL Official has been quoted saying that the company would launch operations all by its own, during its annual general body meeting, according to a report by The Economic Times.

The company intends to build its own towers across India and even make handsets on its own,as well as integrate financial services, a company spokesperson told ET. He was also reported saying that there will be no partnership with Reliance Communications (RCOM) or GTL for the same, and that no combined entity or cash infusion was being planned.

Earlier, there were some speculative reports that HFCL might do the ground work for the roll-out but no official confirmation. It looks like RIL will go solo with its 4G operations, whenever it plans to roll them out.

RIL hasn’t revealed its 4G service rollout strategy yet, and it’s been almost close to two years that the company acquired pan-India BWA spectrum through the acquisition of Infotel Broadband, which had won BWA spectrum in all 22 circles in the country for Rs 12,847.77 crore during the 2010 BWA auctions.

Note that RCOM owns 50,000 towers in 1,500 cities with a spread of 2.8 lakh kilometre pan-India fibre optic network. Considering this, it could have made sense for RIL to use their network for last mile connectivity. This had become more likely after the two brothers scrapped the old non-compete agreement and called for a truce in 2010 paving the way for each other to foray into businesses where one of them was already present including sectors such as power, telecom and financial services. There were reports that RIL was open to sharing network infrastructure with RCOM after the move.

Plans to make mobile handsets: The ET report also quotes the unnamed official saying that RIL might make mobile handsets that do not feature computing capability or storage, to reduce costs, however, he did say that the services will integrate digital content and even mobile payments. Note that there were reports that RIL was in talks with UTV/Disney for content.

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We’re not sure if he was misquoted or if we should interpret it that RIL is not interested in making smartphones. But wouldn’t smartphones or phones with computing capabilities as they say, fuel data consumption, which would be the primary focus of a company launching 4G services?

With inputs from Aman Rai

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