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RCOM Inks 2G Intra Circle Roaming Deal With Aircel

rcom-aircelReliance Communications (RCOM) has partnered with Aircel allowing both the companies to share their mobile towers to offer a pan-India 2G Intra-circle roaming (ICR) coverage to subscribers of both the networks.

This essentially means that RCOM and Aircel 2G GSM users will not have to pay any extra roaming charges on their networks.

RCOM informed that it will initially offer 2G Intra-circle roaming (ICR) coverage in select key circles and later roll it out pan-India. However, the company hasn’t disclosed any specific information on this. The deal period and financial details of the partnership were also not disclosed.

More 2G ICR Partnerships In Pipeline: RCOM claimed that this deal is the first among many such partnerships and it is currently in advanced talks with several telcos across the country for similar partnerships. The company hopes to ink all its 2G ICR agreements by the end of Q2 2013. RCOM said that these ICR agreements will increase its national 2G GSM network footprint by 10,000 base stations.

Telcos typically charge subscribers to use its services in other than home circles, claiming that offering free roaming would deprive them of significant amount of revenue. However in June 2012, the Union Cabinet had approved the National Telecom Policy (NTP 2012) that included proposals such as removal of roaming charges across the nation, thereby providing free roaming to telecom users.  In March 2013, Kapil Sibal Union Minister for Communications and Information Technology had said that the free roaming proposal will be implemented by October 2013, although this proposal is facing opposition from telecom operators such as Vodafone, Airtel, among others.

3G ICR Partnerships: It should be noted that in December 2011, DoT sent notices to Airtel, Vodafone and Idea, who had inked similar 3G ICR service pact, ordering them to scrap the 3G intra-circle roaming pact, since these pacts were illegal. The intra-circle roaming arrangements between telecom operators allowed them to offer 3G services to their customers, despite not having won spectrum in the India’s expensive 3G auctions.

Earlier this month, Delhi High Court had lifted a stay on the government order and had asked Bharti Airtel to stop providing 3G services in seven circles under the 3G ICR arrangement. Following this, Department of Telecom (DoT) had also issued notices to Vodafone India and Idea Cellular cancelling their intra-circle roaming agreements. We are curious to see whether DoT would oppose to similar ICR arrangements over 2G networks as well.

RCOM Revenue Strategy: It seems like RCOM is looking to tie up with other operators to increase its revenues. Earlier, this month, RCOM had inked a Rs 1,200 crore worth agreement with Reliance Jio Infocomm, the 4G subsidiary of its brotherly concern Reliance Industries to share its nationwide inter-city fibre optic network infrastructure. Following this deal, Reliance Jio Infocomm was able to utilize multiple fiber pairs across RCOM’s 1,20,000 KM inter-city fiber optic network to provide 4G services in the country, while RCOM got reciprocal access to the optic fiber infrastructure being built by RIL.

RCOM was also looking to sell 80% stake in its subsidiary Reliance Globalcom and was in advanced talks with Samena Capital, as a part of a consortium with global PE funds. It was also indicated that RCOM is apparently inking a telecom tower lease agreement with Reliance Jio Infocomm, although there is currently no further information on this deal.

(With Inputs From Vikas SN)

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