Reliance Communications Starts Nationwide GSM Service (India)
Reliance Communications Ltd., India’s second-largest mobile-phone company, started nationwide wireless services based on the global system for mobile communications, or GSM, to gain customers.
Reliance Communications, which operates services based on the code division multiple access, or CDMA, standard, will initially cover 11,000 towns and 340,000 villages with its GSM service, Chairman Anil Ambani told reporters in Mumbai today. The operator has completed most of the capital spending on the second network and has spent 100 billion rupees ($2.1 billion), he said.
Ambani will use the network based on the popular GSM standard, which accounts for about 75 percent of India’s 336 million wireless users, to help Reliance Communications catch up with Bharti Airtel Ltd. and keep ahead of rivals such as Vodafone Group Plc and NTT DoCoMo Inc.
“We see no reason why we shouldn’t have a 100 million customers,” Ambani said. The operator had almost 60 million customers at the end of November, while Bharti had 83 million and Vodafone’s Indian unit had almost 59 million users.
Reliance Communications gained 7.2 percent to 228.15 rupees in Mumbai trading, the most since Dec. 10. The stock was the second-best performer today on the benchmark Sensitive Index, which rose 1.9 percent.
India, the world’s second-largest mobile-phone services market after China, added more than 10 million subscribers for the third straight month in November and is set to attract more operators as it prepares to auction licenses for starting high- speed wireless services next year.
Telecom Regulatory Authority of India Chairman Nripendra Misra said in October, operators in the U.S., the U.K., France, Italy and Australia may bid for permits to offer the so-called third-generation, or 3G, services, further increasing competition.
Reliance may spend between 20 billion rupees and 40 billion rupees on 3G gear, Ambani said.
DoCoMo, Japan’s biggest mobile-phone operator, considers Asia its biggest priority for expansion, President Ryuji Yamada said on Nov. 18, a week after the company agreed to pay $2.7 billion for 26 percent of India’s Tata Teleservices Ltd. The purchase is aimed at giving the Tokyo-based company entry into the world’s fastest-growing major wireless market and is its largest acquisition in about eight years.
Tata Teleservices will spend $2 billion in the next two years to provide GSM-based wireless services, the Press Trust of India reported in August. Tata Teleservices, which currently offers CDMA mobile-phone services plans to start the GSM services by the end of the year in India, Press Trust said at the time, citing Anil Sardana, the company’s managing director.
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