Monday, September 10, 2012

Reliance Infotel - My Thoughts + All Updates

Reliance Industries owned Infotel Broadband is going to roll out 4th Generation services on LTE platform and plans to offer data as low as Rs 10/GB, as reported by Economics Times. The report also tells that RIL will also bundle the data with multiple devices. Entry level tablets will be major device for Infotel's LTE offerings and it may cost as low as Rs 3500/ ~$70 (Just remember Aakash - the $35 tablet).

But this report has nothing new, all these stuffs are already said on ET. RIL is keeping all of its BWA plans under hood and no one can have it. Even their employees are also very secretive regarding BWA launch. Interestingly this latest 2-page report by ET creates a storm among telecom portals - Medianama & goBroadband makes a follow up story.

MoneyControl published a report on October 3, 2011 saying it can be Operation Vijay for Reliance as Mukesh Ambani re-enters telecom space. But this story also does not have the substance to make us cheerful. All stories on media are based on rumor or market speculation.

But only story that caught my brain is by Forbes India, says Reliance Juggernaut On The Move. Again! The story depicts the entry of RIL in telecom space as battle of Titans - 'The first time Mukesh Ambani disrupted Indian telecom, Sunil Mittal survived, even emerged stronger. Can he pull it off a second time?'

Anyway shifting the focus of the story to Infotel's offering of 4G data at Rs 10 per GiB. goBroadband man Chetan explains that this is not impossible and Infotel can really offer 4G data at Rs10/GB.

Reliance Infotel will hit current broadband players (wired and wireless)

Infotel LTE will not only hit current 3G and EVDO players but also hit wired players badly. With 1Mbps plans with 25GB FUP it can easily score better than BSNL Broadband. Only way out is to deploy Fiber optics (Refer to Beam's Fiber plans). Cable players will see the same fate of BSNL.
Currently for data EVDO players are widely accepted (Though I find many people complaining against Reliance/Tata/MTS/BSNL's EVDO). Smaller wireless players using MIMO like Tikona and many very local players will be in big trouble for sure.

With price point Reliance will try to grab many users and not only that with exchange offer with old devices (ADSL modem, EVDO/3G dongles) they can kill others' business too.

Infotel Will Focus in Urband Areas

With 2300 Mhz spectrum, I do not think he can go beyond urban and semi-urban area. As no deal has been finalised with vendors or the deals are not in public I can not think more on this. But if Govt allows Reliance to enter into auction of 700 MHz BWA spectrum, Infotel will enter into rural areas.

Expected Tariffs & Devices

It is expected Infotel will have all kind of arsenals to win the people's heart along with price war. Tablets, dongles, even desktop and laptops may be bundled. I am expecting multi-mode dongles (LTE, HSPA, EVDO, 1X, EDGE/GPRS).
Tariffs is hard to predict, but Rs 10/GB is certainly not on lower tier plans.

But I think about current 2G(EDGE/GPRS/1X) and 3G (HSPA/EVDO) players - what can they do if Reliance Infotel shatters a tariff war on them? Unlimited 2G at Rs 50 and 3G data tariffs lowered down atleast 200% ? Only time can tell that.

Voice over LTE (VoLTE) is Happening or not

With no proper policy of VoIP I do not think VoLTE is happening soon. Also VoLTE is still in testing phase. Infotel may tie up with RCom to offer voice services or buy out a 2G player. Potential prey is Videocon.

Update (Dec 6): Business-Standard comes up with an update, that RIL is planning to tie up with cable operators who have extensive fiber network across the country. Following order to digitalise the cable TV sector, cable operators & MSO (multi system operators) has put fiber of more than 1 lakh Km over the country. The report also says the launch is delayed and expected happening in Mid 2012.

My Take: Someone willing to launch India's fastest broadband thought to be smart keeping aside the cable operators, and at the end he turns out to be a big zero. (September 2012: they just tied up with some MSO, as claimed. ) However the fact is RIL with tie up with MSO & cable operators may go in advanced rural areas very easily. It also says that RIL does not depend upon one backbone player, as I predicted.   

Update (Dec 12): The Hindu Business Line reports Broadband players may get additional microwave spectrum for backhaul.

Update (December 9, 2011): Voice&Data explains the delay of LTE roll out, read more.

Update (February 8, 2012): Voice&Data explains Infotel's game plan [a good read, explains all aspects of RIL's game plans]

Update (March 3):  Nagpur as Reliance Infotel's 4G Hub? Mukesh clears that Infotel will have more than one cities to be Infotel's 4G hub.

Update (March 26): RIL to start 4G trials in Jamnagar in April, 2012, reports DNA. The report hints Huawei, ZTE and Alcatel Lucent may be the equipment vendor for RIL Infotel. DNA also reports that pricing may be Rs 1000-2000 INR for 5-10GB of data.

Update (March 26): Anuj Jain is appointed as RIL Infotel's new Executive Vice President (EVP) and Chief Technology Officer (CTO) to drive the company's 4G and LTE initiatives. via Light Reading.

Update (April 23): EconomicsTimes reports that RIL will set own towers to support country wide 4G network. RIL will set up over 1 lakh towers. ET also reports that RIL will invest on carbon fiber tower material instead of traditional steel towers. Carbon fiber based towers will be costly, but eco-friendly and easy to relocate. Earlier RIL Infotel wanted to rent 26000 towers for phase I roll out, but this move says they will not be light in assets. One analyst explains that RIL may install their own towers in rural and semi-urban areas where other tower companies have few towers, while in urban area RIL will be on rent on other companies' towers. 

Update (May 7): RIL looks beyond LTE to wireline and other wireless tech by Hindu BusinessLine.
''In addition to LTE and its future versions, Reliance will continue to evaluate and deploy other technologies, both wireless and wireline, to offer comprehensive broadband solutions to consumers, small businesses, enterprises, government and other entities.'' RIL said that while there many operators investing in creating a broadband network, it will focus on making available all the components of the entire digital value chain. This value chain comprises of devices, relevant local content, customer support and network.

Update (May 7): RIL is lobbying to stir Qualcomm's 4G plan in India, as it will directly hit Airtel's 4G plan in Delhi and Mumbai - top 2 market for 4G. More on firstpost. Qualcomm is in a mess in India with their ISP license, and hence allocation of 4G/BWA spectrum to them was delayed. RIL asked that to cut down license validity of Qualcomm to 18.5 years (while other BWA players have 20 years of validity) as delay was due to Qualcomm's mistake. Ultimately when Qualcomm got the spectrum in May 2012 validity of the spectrum was 18.5 years. As Qualcomm's 4G plans are delayed for Delhi & Mumbai - the expected top two market for 4G data, Airtel can't buy the circles from Qualcomm - that means RIL will be in a better position.

Update (May 22): DNA reported that RIL's trial in Jamnagar gets delayed to August. Earlier DNA reported that this trial would commence from April, 2012. So in that case RIL may not roll out services by end of 2012. Just few days back Airtel bought 49% of Qualcomm's Indian 4G venture, thus enters Delhi, Mumbai, Kerala & Haryana with 4G (roll out will be soon). So Airtel may get first mover advantages if they can roll out 4G in Mumbai and Delhi before RIL.

Update (May 29): Reliance Industries (RIL) led consortium might win a significant internal security deal worth Rs 1,000 crore, for installing CCTV cameras at all major traffic junctions in Mumbai, more on Medianama

Update (June 7): In 38th annual general body meeting of RIL, Mukesh Ambani told about investing Rs 1 lakh crore in energy, retail and telecom businesses, among others in next 3 years.

It has been known that RIL is finalizing plans to start nation wide services as greenfield project which will provide range of digital services in key domains of national interest such as education, healthcare, security, financial services, government-citizen interfaces and entertainment. There is no leak of exact date of launch.

It also has been known that RIL will make their own towers, with no rural or urban division. The officials cleared that there is no clear cut valuation of towers, and RIL can make towers of its own for Rs 10 lakh each, while buying towers from Reliance Infratel or GTL would cost Rs 40 lakh per tower! RIL has partnership with DE SHAW - finance company which will help them to offer e-money services in India. RIL also has plan to create and sell own devices - mobile phones and tablets! [ET Telecom]

Update (June 8): RIL will set up a facility of Infotel Broadband at the upcoming Devanahalli information technology (IT) park at Karnataka. The facility will spread over 36 acres, will have investment of Rs. 3,300 crore from RIL. [ Livemint ]

Update (July 2): The Telegraph reports that RIL is revising its plans for Infotel Broadband. RIL will make their own towers, mobile phones and tablets - all it takes quite a time, and so launch of Infotel is shifted to 2013-2014. Well RIL has time limit upto 2015 to roll out services, so no tension of penalty.

Update (July 12): With 4G launch, RIL plans to kill many birds with one stone via Livemint. The reports says Infotel may debut in Delhi and Mumbai in early 2013. A report by ZDNet says LTE to be mainstream in India by 2015.

Update (July 16): State run operator BSNL plans to share 24k towers with RIL at discounted price, reported by Financial Express.

Update (July 20): Business-Standard reports that RIL is planning to bid for 2G spectrum in all circles. So simultaneous voice and data offering will make RIL biggest threat to Airtel and Vodafone. I have no idea what will happen to Rcom.

Impact of RIL's entry into upcoming 2G auction:
1. Fierce bidding
2. Incumbent players will not participate, except Tata and Idea will bid for their cancelled circles
3. Only one GSM player (among Uninor, Videocon, Cheers, STel) can win back their spectrum if RIL bids for 1800MHz band.
4. High chance RIL may bid for 800MHz spectrum, 'coz CDMA is Mukesh Ambani's long time love. Also CDMA800 means more coverage, and in future FDD-LTE over 800MHz can be deployed like Europe is doing. Note that LTE can be deployed on 2 x1.4MHz channels and RIL can put dual mode LTE-FDD and LTE-TDD network.

Medianama report on RIL Infotel's plan to bid for 2G spectrum

July 25, 2012 - In India, Dreaming of A 4G World via WSJ

Samsung wins LTE-TDD deal for Mumbai circle - via LightReading

August 23: 
Bharti vs Reliance: Market gets ready for Big Fight  - Firstpost
Bharti Airtel shares hit six-year low - LiveMint
Telecom sector is heading for a big battle as Mukesh Ambani's Infotel Broadband moves ahead to bid for the upcoming 2G spectrum - India Today
Bharti Airtel bleeds after Credit Suisse slash, competition fears intensify - India Today
2G Spectrum auction: How it affects existing telecom operators - TelecomLead

August 30
Reliance Getting Ready for 2013 Launch - Voice&Data 

RIL planning for something like Google Fiber.

Reliance’s low-cost tablets may hit 3G players: Gartner  - The Hindu Businessline
RIL is all set to create turbulence in the market. The low price of the devices, cheap data plans and a planned nation-wide deployment would be disruptive trend for the existing 3G service providers.

Infinera Corp, Ciena Communications and Alcatel-Lucent are selected by RIL Infotel Broadband for buying Rs 2,250-crore ($500 million) worth of optical network transmission gear. Details on ET, September 12.

Stairway to 4G

September 11: moneycontrol reports RIL signs deal with Cisco for core tech framework for 4G. But the article also says something disappointing to many Indians, "Instead of bringing out a pricing strategy where the company is slashing prices, RIL plans to have a similar pricing as Bharti . However, it will create a differentiated platform of music and video application. It will create a unique platform, something similar to iTunes. It is will be specialised with Reliance.

The strategy is to bring in the whole gamut of services -- Bharti probably has around three-four services -- RIL will bring in around 8-9 specialized services within that same price band.

September 12, 2012: Optical Crunch Time at RIL by
Infinera is having many optical network deals in India, after RailTel, RIL chose them.

(Also read ZTE Struggling To Meet Enterprise Goals: Sources, Lightreading)

Sumit D Chowdhury is now Chief Information Officer at Infotel Broadband via Light Reading India

September 16: ET reports, RIL will make ultra-low cost base stations, to be priced each at 1 lakh rupees only, compared to usual BTS costs Rs 40 lakh each. RIL will also rent out these towers. RIL will set up 1 lakh such low cost towers over the country and will rent some towers from others.

Infotel is focussing on a low-cost model so that it can keep the rates of 4G telecom services lower than that of other players. The services may be launched as early as 2012-end, but there is more likelihood of launch in 2013.

RIL's Smart Move For 4G Launch - LightReading
Reliance Infotel finalizes OSS/BSS vendors for LTE - Voice n Data
Way to 4G : Reliance Infotel is Busy to Finalize Vendors - telecomtalk

RIL is on hiring spree, latest one is Ericsson for WiFi deployment via Lightreading. Many time I told on telecomtalk about WiFi offload, it seems RIL is going in the right direction.

Abdul Khan, ex-senior vice-president and national head for business marketing at Tata Teleservices, has moved to Reliance Industries for second time. source - afaqs 

**this blogger shit gives me error:  "An error occurred while trying to save or publish your post. Please try again.", so I am putting all next details with a new blog post, that will be notified next time**

For more updates check Part #2 of this long story.


Timeline of Infotel Broadband
Indian Govt conducted BWA Spectrum Auction in June, 2010 & Infotel Broadband, promoted by Nahata was the only pan India BWA spectrum winner among 11 participants. Reliance WiMax who also participated in the auction, left in the midway. Infotel owns the 20 MHz spectrum in 2.3 GHz band in all 22 circles of the country.
RIL buys out Infotel -   June 11, 2010
RIL Gears Up for BWA Launch  -   April 19, 2011
RIL has pact with Disney UTV for contents on 4G platform.

Mukesh Ambani and Indian Telecom

If you look into history, Mukesh Ambani was the pioneer of CDMA technology in India with his Reliance Infocomm. Reliance India Mobile with its best-value-for-money offer (dubbed as Monsoon Hungama) reached the hands of thousands of Indian with the tagline- ‘Kar Lo Duniya Mutthi Mein’.

In 2006 the Ambani brothers split, and Reliance group is divided between Mukesh and Anil Ambani. Anil Ambani owns the telecom asset and renamed it as Reliance Communications.

In May 2010 the Ambani brothers entered into an “environment of harmony” agreement that virtually allowed their groups to enter any business they desired, ending a previous non-compete agreement. This allows Mukesh’s Reliance Industries to enter into Telecom Space.
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