Reliance Infotel’s 4G Plans

Multi-vendor and multi-technology complexities are forcing operators to move towards managed services

Reliance Industries, in 2010, through its acquisition of Himachal Futuristic Communications, Infotel signaled its entry into the mobile broadband telecommunications industry. For 4,800 crore Reliance Industries acquired a 95% stake in Infotel. RIL paid an additional 12,848 crore as license fee for a 20 MHz spectrum across 22 telecom circles. This bold, strategic investment gave RIL, through the new entity Reliance Infotel, a pan-India presence in the telecom sector.

So, what should Reliance Infotel do with such a huge network, acquired after making very substantial investments? Unfortunately, telecommunication services haven’t done well in the India enterprise space so far. In spite of being the world’s second largest consumer mobile telephony market, enterprise services don’t measure up to the advancements made in the former. The India market has witnessed limited traction for enterprise telecom services, offered by various operators.

The Issues

Coming back to the issue as to what Reliance Infotel should do with its 4G network, as a first step they have the option of rolling out services for individual subscribers andIor enterprises. But, looking at the story of adoption of 3G services in the country so far, 4G is likely to follow the same route, at least in the individual subscriber space.

Service offerings could either end up being priced out of reach at launch, making them unaffordable for the larger base of subscribers; additionally, availability of 4G-enabled smartphones and tablets would be a hindrance. So, for now, it may be ‘ok’ for Reliance Infotel to not launch any services directly targeted at individual subscribers. Even when introduced, the volume of traffic generated by use of applications such as YouTube, etc, is not likely to provide sufficient growth impetus to a company of the size and scale of Reliance Infotel.

Unfortunately, beyond Bollywood musicIvideo clips and cricket, India still does not have enough indigenously generated, quality content to drive 4G data services growth.

The Options

Reliance Infotel has the option of positioning itself as a BPA Internet Service Provider (ISP) across India wherein they could offer high speed broadband access through a CPE device that is shared by several users, say, a group of friends in a hostel, a cluster of apartments, etc.

But for such a system to become popular and see high adoption rates, the individuals or families that make up a group need to display exceptional bond-