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Reliance Jio Infocomm Inks Deal Worth Rs 1,200Cr With RCOM To Share Fiber Optic Network

After months of rumors about whether the two entities are going to partner or not, it appears that RIL and RCOM have finally agreed to partner. According to a BSE filing, Reliance Jio Infocomm Ltd. and Reliance Communications Ltd. have signed an agreement worth Rs 1,200 crore for sharing RCOM’s nationwide inter-city fibre optic network infrastructure. With this agreement, Reliance Jio Infocomm will be able to utilize multiple fiber pairs across RCOM’s 1,20,000 KM inter-city fiber optic network to provide 4G services.

According to the report, RCOM, in return, would get access to optic fiber infrastructure to be built by Reliance Jio Infocomm in the future. It also states that the agreement is the first in an intended comprehensive framework of business co-operation between Reliance Jio Infocomm and Reliance Communications. It will also allow both the companies to utilize the existing and future infrastructure of both companies on reciprocal basis, including inter alia, inter-city fiber, intra-city fiber, towers and related assets.

It should be noted that RIL had acquired 95% stake in Infotel Broadband services, after it secured pan-India BWA Spectrum for Rs 12,847.7 crore during the 2010 BWA Auctions. RIL is the only company to have a pan-India BWA Spectrum in the country.

RIL 4G Timeline:

March 28, 2013: Milind Deora, Minister of State for Communication and Information Technology, has informed Lok Sabha that each BWA Licensee has rollout obligations depending on the service area license.

As per these obligations, Licensees should provide street level coverage in at least 90% of the metro service areas within five years of the effective date, failing which the BWA spectrum provided will be withdrawn.

Licensees should also ensure coverage in at least 50% of the rural short distance changing areas (SDCAs). The minister noted that a rural SDCA is considered covered, if the licensee provides street level coverage in at least 90% of the area bounded by municipal/ local body limit. This essentially means that RIL and other BWA licensees have around two more years to meet these obligations.

March 20, 2013: Maxis Communications CEO Sandip Das is joining Reliance Industries as the head of its 4G venture, according to a The Economic Times report. Citing two sources with direct knowledge on this development, the report states that Das will be working with Manoj Modi, who is apparently leading RIL’s 4G rollout in the country. RIL has however declined to comment on this appointment to the publication.

Das had joined Maxis in January 2007 and was appointed as the company’s CEO in October 2009. His tenure as the CEO was expected (pdf) to end on June 30, 2013 but the companysaid that Das had requested an early release from his contract, which was accepted by the company’s board and Das was planning to step down as the company’s CEO on April 15, 2013.

Prior to the Maxis appointment, Das had worked at Vodafone Essar Limited, India (erstwhile Hutchison Essar Limited) as its deputy managing director and was one of the members responsible for setting up the company’s operations in India in 1994. He’s also had stints at Al-Futtaim Motors and Sriram Group’s Usha International.

March 11, 2013: AT&T is apparently planning to pick up 25% stake in Reliance Jio Infocomm (previously Reliance Infocomm) for $3.5 billion (Around Rs 18,991 crore). It was also reported that RIL is looking to launch its 4G service on December 28, 2013 and will be rolling out the service in a phased manner, starting with Delhi and Mumbai later in the year, followed by 69 Indian cities in 2014 and over 800 Indian cities by early 2015.

March 8, 2013: The Indian Government has dismissed allegations that it has offered undue benefits to RIL by allowing 4G spectrum holders to offer voice services by paying an additional Rs 1,658 crore for the license, according to a The Economic Times report. Telecom Minister Kapil Sibal said that this decision was taken based on the recommendation of Telecom Regulatory Authority of India (TRAI) and the Telecom Commission.

This development follows allegations from Cellular Operators Association of India (COAI) earlier this week, which claimed that the telecom department had proposed these policy changes to give undue benefits to RIL and the unified license regime should not be used to provide a backdoor entry for BWA players to offer voice services.

According to a separate ET report, Mukesh Ambani has also reportedly sent a letter to the Telecom Secretary, alleging that COAI is working for selfish and short term motives of its member operators and pointed out that COAI had previously supported government’s plans to allow BWA players to offer voice services for Rs 1,658 crore. Ambani has also reportedly said in the letter that operators should compete with RIL in the open market instead of delving into such practices.

March 7, 2013: RIL has apparently partnered with Samsung to make use of Samsung’s LTE technology for its 4G service in India. As part of this agreement, Samsung will reportedly offer 4G-compatible entry-level smartphones for around $100 (Approx Rs 5,500), which will be bundled with RIL’s 4G data plans starting at Rs 100.

Feb 22, 2013: An RIL group firm Reliance Payment Services was apparently one among the companies shortlisted by public sector banks to manage and deploy at least 2 million Point-of-sale (POS) debit and credit card swipe machines across merchants in smaller towns over the next two years.

Feb 7, 2013: Reliance Jio Infocomm (Previously Reliance Infotel) is planning to launch a multi-screen video ad network.

December 21, 2012: Reliance Industries was all set to receive Department of Telecommunication (DoT)’s approval to test voice services on its 4G networks. In Feb 19, the Telecom Commission had approved a recommendation which allowed the Broadband Wireless Access (BWA) spectrum holders

December 19, 2012: Reliance Industries had inked a deal with Moscow-based Spirit DSP to license Spirit’s TeamSpirit Video and Voice engine to RIL subsidiary Jio Infocomm (previously Infotel) to provide Skype-like video and voice calling services (VVoIP) to its subscribers.

December 3, 2012: Reliance Industries (RIL) was reportedly planning to roll out its much awaited 4G service in Mumbai and Delhi in mid 2013. The company had inked contracts with Ericsson and Samsung to build the network, IBM for IT integration and Microsoft for security solutions. RIL was also planning to launch MiFi devices and inked contract with Ericsson to set up around 30,000 Wi-Fi hotspots across commercial buildings, offices and malls in Mumbai and Delhi.

November 9, 2012:  Ajit Nazre, a former partner with the venture fund Kliener Perkins Caufield and Byers (KPCB), and Arvind Rao, former CEO of mobile VAS company OnMobile Global, had joined Reliance Industries in an advisory capacity for the company’s 4G rollout. While both Nazre and Rao had separately confirmed this development to MediaNama, they had declined to comment on the exact nature of their roles.

July 19, 2012: State owned telecom operator, BSNL had reportedly signed an agreement with Reliance Industries (RIL) subsidiary Infotel Broadband to share its 24,000 towers.

June 8, 2012: A Senior RIL official had said during its annual general body meeting that it was launching its 4G operations all by itself. This was contrary to earlier reports of RIL partnering RCOM for its 4G rollout, its towers and pan-India fibre optic network. The official had also stated that it plans to launch self-branded mobile handsets.

May 29, 2012: A Reliance Industries (RIL) led consortium had apparently secured an internal security deal worth Rs 1,000 crore, for installing CCTV cameras at all major traffic junctions in Mumbai.

March 26, 2012: RIL had reportedly started its 4G service trials in Jamnagar in April 2012.

January 16, 2012: Reliance Industries was reportedly in talks with major cable operators, including MSOs (Multi-System Operators) such as Hathway, Den, Digicable and InCable to pick up a minimum 26% stake in these companies.

January 3, 2012:  Network18 divests a part of its stake in ETV channels to TV18 Broadcast, to secure preferential access to Network18′s content from all its media and web properties and TV18′s programming and digital content of all its broadcasting channels.

December 6, 2011: RIL was reportedly planning to offer tablets at a subsidized price of Rs 3,500 with bundled 4G data plans starting at Rs 10 per GB.

November 9, 2011: Infotel had acquired 38.5% stake in Extramarks Education, a provider of digital delivery of education related services.

October 10, 2011: RIL was reportedly planning to ink a joint venture with Disney’s UTV to offer content like games, Bollywood content and children’s content among others.

September 20, 2011: RIL through its subsidiary company, Reliance Security Solutions, had signed a memorandum of understanding (MoU) with Siemens for homeland security solutions which will leverage its 4G network. Through this deal, RIL was planning to offer networked security services using video and other security applications, and was eyeing an integration with large scale city and highway projects for surveillance and law-enforcement.

May 23, 2011: US based banking and financial products company American Express wasreportedly in talks with RIL to launch a joint venture in India that will offer financial services, including a payment gateway.

November 30, 2010: RIL conducts a field trial of its 4G service at its campus.

June 11, 2010: RIL had acquired 95% stake in Infotel Broadband services, after it secured pan-India BWA Spectrum for Rs 12,847.7 crore during the 2010 BWA Auctions.

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