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RIL To Bid In The Upcoming 2G Spectrum Auction: Report

Mukesh Ambani owned Reliance Industries (RIL) is planning to bid for spectrum in the 1800Mhz band in upcoming 2G spectrum auction, according to a report by Business Standard. The report states that the company is planning to bid for spectrum across telecom circles in the country and intends to offer this service to complement its 4G data services as well as to act as a pure play telecom operator.

As per the DoT guidelines, new entrants are required to bid for a minimum of 4 blocks of 1.25 MHz, and will also be allowed to bid for one additional block, if they participate in the auction for spectrum in the 1800MHz band.

– Expect more competition: Note that RIL was in the voice business until both the Ambani brothers separated during the Reliance group split in 2005, following which the telecom business went to younger brother Anil Ambani and there was a non-compete agreement between the two which ended in 2010. When RIL launched its (limited) mobility services under the Reliance Infocom brandname, it played the price card offering handsets for as low as Rs 500. Also, the company had offered free access to data services including mobile TV on its R-World portal for years before making it paid. Although, it attracted a lot of subscribers, the company faced losses and had to write-off unpaid bills accounting to Rs 4500 crore. It would be interesting to see if RIL’s entry will impact the existing operators in the 2G segment including Airtel, Vodafone, and Idea, among others.

4G+Voice: Also, RIL already has a pan-India BWA spectrum in the country, by virtue of its acquisition of Infotel Broadband services in June 2010, which allowed RIL to only offer high-speed data service sans any voice services to its customers. However, according to the recently passed telecom policy which got approved last month, the operator was allowed to offer voice services through 4G or BWA whenever an appropriate regulatory framework for progressive liberalisation of spectrum utilisation was established in the country.

It was previously suggested that RIL will be partnering with ADA group’s Reliance Communications for its 4G rollout, and access RCOM’s 50,000 towers across 1,500 cities and its 2.8 lakh kilometre pan-India fibre optic network for last mile connectivity, however another similar report last month indicated that RIL will not be partnering with ADA Group’s Reliance Communications and that it plans to launch its 4G service all by itself. Earlier this week, RIL’s subsidiary Infotel Broadband was rumored to have signed an agreement with BSNL to share its 24,000 towers to supposedly help Infotel speed up the launch its 4G services to the end of this year.

That aside, there were also some speculative reports that HFCL might be doing the ground work for the roll-out but no official confirmation. It was also reported that RIL was planning to launch its 4G service in early 2013  in New Delhi and Mumbai and expand it to 50 cities in the first two years and pan-India coverage in the next four years. However there is no official 4G service rollout strategy from the company yet, which is disappointing considering that it had demoed the service at its campus in 2010.


– DoT Guidelines For 2012 2G Spectrum Auction; Bid Price?

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