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Business News/ Industry / Telecom/  Reliance Jio launch by 15 March 2015: Credit Suisse
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Reliance Jio launch by 15 March 2015: Credit Suisse

The firm acquired the 4G spectrum four years ago but has since waited for clarity in telecom policy and development in technology

The Credit Suisse report said that Reliance Jio had signed on Samsung Electronics Co. for equipment for 60,000 base stations and was expected to sign a deal for an additional 50,000-70,000 base stations soon.Premium
The Credit Suisse report said that Reliance Jio had signed on Samsung Electronics Co. for equipment for 60,000 base stations and was expected to sign a deal for an additional 50,000-70,000 base stations soon.

New Delhi: Reliance Jio Infocomm Ltd will start full-fledged voice and data services by 15 March and is accelerating the pace at which it is installing base stations, according to a report by investment bank Credit Suisse.

Reliance Jio acquired the spectrum to do so four years ago, in 2010, but has since waited for clarity in telecom policy and, more importantly, the technology to evolve.

A spokesperson for parent Reliance Industries Ltd (RIL) did not respond to e-mails seeking comment.

Reliance Jio has already installed approximately 32,000 LTE (long-term evolution) base stations with the pace of installation touching approximately 7,000 per month, more than double the approximately 3,000 a month that the company was doing in May, Credit Suisse analysts Sunil Tirumalai and Chunky Shah wrote in a 16 September note to clients. LTE is a technology standard for high-speed wireless data networks.

The report attributed the numbers to its own channel checks and also said that Reliance Jio had signed on Samsung Electronics Co. for equipment for 60,000 base stations and was expected to sign a deal for an additional 50,000-70,000 base stations soon. This would take the total number of base stations the company will have to more than 110,000, on par with incumbent operators such as Bharti Airtel Ltd, Vodafone India Ltd and Idea Cellular Ltd, that took around 15 years to get to that number.

The base stations being built are multi-mode; they allow for multiple technologies on multiple bands of spectrum—in this case FDD LTE (frequency division duplexing) and TDD LTE (time-division duplexing), the two rival fourth generation (4G) wireless telephony technologies. The telecom department last week issued the company spectrum in the 1800 megahertz (MHz) band that it won in the February auction in 14 circles. This will enable the company’s contracted vendors to start importing the necessary equipment.

Reliance Jio is expected to start basic voice services on the 1800MHz spectrum initially, using FDD VoLTE (Voice over LTE). The viability of this has many in the telecom industry divided. A July report by the Global Mobile Suppliers Association said that there are 300 commercial LTE networks in the world, of which 43% use the 1800MHz band which has the widest device ecosystem. But only eight (of the 300) are using VoLTE and only 28% of LTE devices support both FDD and TDD, the report added.

Mint reported in May that Reliance Jio would start its services using several technologies, including the two rival 4G high-speed wireless technologies, as well as FTTx (fibre to the location) and WiFi.

According to RIL’s latest annual report, Reliance Jio will use FTTx in 900 cities and towns, and has already activated WiFi hotspots in many parts of the country.

FTTx refers to a broadband network architecture that uses optical fibre, partially or completely, to provide high-speed data connectivity to a fixed location. WiFi (wireless fidelity) is a technology that allows an electronic device to exchange data or connect to Internet wirelessly.

Reliance Jio acquired 1800MHz band spectrum in 14 circles across the country for 11,054 crore in the February auction. It acquired 20MHz blocks of 2300MHz spectrum in all 22 circles in 2010 for 12,847 crore. The company is also estimated to have laid around 100,000km of optical fibre across the country to support the high data speeds of LTE.

On the handset side, the Credit Suisse report said that sub-$100 LTE smartphones could become a reality and be fairly disruptive for the market.

Reliance Jio is already testing the services through so-called product experience pilots at Navi Mumbai and Jamnagar. RIL is expected to invest around $10 billion in the venture.

Reliance Jio is building its own towers and has also signed multiple tower-sharing agreements with Bharti Infratel Ltd, Reliance Infratel Ltd, Viom Networks Ltd, Tower Vision India and ATC India Tower Corp. Reliance Jio is also expected to announce signing a tower sharing deal with Indus Towers later this week. Reliance Jio has optical fibre-sharing agreements with Bharti Airtel Ltd and Reliance Communications Ltd.

Meanwhile, Reliance Jio has hired ANZ, Bank of Nova Scotia, Barclays, BNP Paribas SA, Bank of America Merrill Lynch, Bank of Tokyo-Mitsubishi UFJ, Citi, Credit Agricole, DBS Bank, HSBC, Mizuho, RBS, Sumitomo Mitsui Banking Corp., Standard Chartered Plc. and Westpac Banking Corp. to arrange a $1.5 billion loan to refinance its debt, Bloomberg News reported, citing a person familiar with the development, who asked not to be identified because they are not authorized to speak to reporters.

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Published: 18 Sep 2014, 12:42 AM IST
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