BWA spectrum cheaper, but has better growth potential: RIL

Pan-Indian cost of BWA spectrum was 0.06 as against 0.32 for 3G

PTI | June 14, 2010



RIL said that BWA spectrum has been acquired at a much cheaper price compared to 3G radio waves, but the BWA spectrum asset would be much useful in terms of growth potential and further expansion.

RIL said the pan-Indian cost (in USD/Mhz/population) of BWA spectrum was 0.06 as against 0.32 for 3G.

Besides, the BWA spectrum acquisition price was extremely competitive by global benchmarks also, it added.

It also claimed that 3G spectrum "holders will remain inherently disadvantaged for data services even if they deploy LTE (a new generation technology that enhances the performance of telephony and data services)" and the BWA spectrum would give "utilizable bandwidth which is more than double" of the 3G spectrum.

RIL's Infotel acquisition came days after the two Ambani groups, led by Mukesh and Anil, announced scrapping their non-compete agreement in most of the businesses. Late last month, Anil Ambani group's RCom paid Rs 8,585.04 crore for 3G spectrum in 13 circles, including Delhi and Mumbai.

Other telecom operators having won 3G spectrum include Bharti Airtel, Vodafone, Idea and Tata Communications.

While Infotel was the only entity to win pan-Indian BWA spectrum, others having bagged this spectrum in various circles include Bharti Airtel and Qualcomm.

RIL said that that it sees significant market potential as less than 5 per cent of cellular subscribers use wireless broadband and it has become the "only private operator with pan India spectrum."

It further said that it aspires to attain a leadership position in this market and would seek to "enable rapid growth in data usage, in both rural and urban markets, propelling India into global data leadership."

The company would serve business enterprises, social organisations, educational and healthcare institutions and Indian consumers with a "asset light approach, in collaboration with strategic partners such as leading global technology players, service providers, infrastructure providers, application developers, device manufacturers etc."

Hinting at services being provided at ultra-low costs, as the group had done with mobile services business when Reliance Infocom started business under the fold of undivided Ambani family, RIL said that unavailability of "affordable devices" was a key constraint for the growth in this segment and it was imperative to "promote subsidies for institutions and educational segment.

RIL also said that smartphones and PCs were still selling for over USD 300 range (about Rs 14,000 and above) and it was very important that the equipment makers come out with "low cost smartphones and affordable PCs for the mass market."

RIL said that currently, China has 130 million broadband users, which India can achieve in a 3-4 year timeframe.

"3G and BWA will be key drivers for rapid growth of advanced data services (and) mobile broadband (was) likely to be primary means of broadband access," RIL said.

 

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