R-Com plans to roll out GSM services in 100 cities in 6 months

R-Com plans to roll out GSM services in 100 cities in 6 months

Author | Source: Business Standard | Monday, Oct 22,2007 8:24 AM

R-Com plans to roll out GSM services in 100 cities in 6 months

To offer dual-chip phones for both its CDMA and GSM networks.

CDMA-technology service provider Reliance Communications (R-Com) has prepared a plan to roll out its GSM services in over 100 cities and towns within six months of the government providing it spectrum (radio frequencies that enable wireless communications).

This will be part of the first phase of its pan-India GSM services launch. Sources said a launch of GSM services in all 15 circles would be completed in around 12 months.

The company is also expected to offer dual-chip phones that will operate both on its CDMA and GSM networks.

Sources said the company would invest around $2 billion over two and a half years to put together a network to support GSM services.

The company has set itself a target of over 100 million customers by 2010. Some analysts have predicted that by then around 30 million R-Com customers would come from its GSM operations

The Anil Dhirubhai Ambani Group-controlled company received permission, and has paid the fee, for dual-spectrum use last week. The company operates mainly CDMA services but has GSM operations in some eight circles.

Before last week, the company was permitted spectrum for either one or the other of the technologies in each circle but had requested the government for spectrum for GSM services under its existing licence in February 2006.

The request followed serious differences with Qualcomm, sole global proprietors of CDMA technology.

The initial marketing focus is on cities and towns where the churn of GSM customers is high by offering them an attractive alternative. An R-Com spokesperson, however, declined to comment on the issue.

R-Com has already signed flexible agreements with leading telecom equipment companies like Chinese major Huawei and Alcatel-Lucent that will reduce the time needed to roll out the GSM network.

Also 95 per cent of its over 14,000 towers are linked to a fibre optic backbone that eliminates the need for a micro-wave link, which also requires spectrum and therefore adds to delays. The company is investing heavily to set up 37,000 towers by March next year.

The company, however, has to wait till the department of telecom acquires around 20 MHz of spectrum from the defence services. Except in Mumbai, where it is number three in the queue for spectrum (Aircel and Idea are ahead), R-Com is number two in all other areas for which it has applied for GSM spectrum.

The company has also applied for a fresh pan-Indian licence through two companies, Swan Telecom and Cheetah, in which it has less than 10 per cent equity. It is one among 30 companies that recently put in their applications.

Analysts said the applications were primarily an alternative plan if the government decided to disallow dual spectrum allocation.

Tatas may apply for dual-use spectrum

The Tata group is expected to apply for GSM spectrum in the 19 circles in which it operates CDMA services currently.

The move comes a few days after the government cleared a policy allowing existing licensees to use dual spectrum and offer services in both technologies.

CDMA players Reliance Communications in 15 circles, HFCL in Punjab and Shyam Telelink in Rajasthan have already been cleared for GSM spectrum.

Sources said the Tata group would apply provided it was allowed in accordance with the existing guidelines. The group has also applied, and is awaiting government clearance, for spectrum in three more circles.

With this move, virtually all CDMA players in the country have shown interest in opting for GSM services as well.

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