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Reliance Industries Ltd’s plans to introduce inexpensive Long Term Evolution tablets and tariffs, could be disruptive for existing 3G operators.
The company has plans to introduce a Long Term Evolution (LTE) tablet priced at Rs 3,500 (about $60) in the Indian market. It has already tied up with Datawind for the production of these tablets, according to a report by research and advisory firm Gartner.
Long Term Evolution (LTE), commonly called 4G, is a telecommunications standard for high-speed data access. In India, 4G (which is 4-10 times faster than 3G) licences were issued to six operators, with four of them actively looking to deploy the services.
“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,” Gartner Principal Research Analyst Rishi Tejpal told Business Line .
This is because 3G operators have paid huge amounts for spectrum acquisition and infrastructure as it will be difficult for them to compete at the price levels that Reliance might offer, Tejpal, who authored the report, said.
“RIL is yet to announce the launch dates of its 4G plans. We expect that the commercial launch will happen before the end of 2012 or sometime in early 2013,” he added.
The adoption of 3G is picking up gradually, after it was launched more than 36 months ago. There are certain limitations that might “inhibit” the growth of 3G in India, which in turn will boost LTE adoption.
“These include issues over intra-circle roaming, limited spectrum availability (5 MHz for 3G operators), non-availability of additional spectrum and no clarity of possible 3G auctions in near future among others,” he said.
LTE will offer affordable high-speed broadband and voice services, and will also address the low broadband penetration in the country.
Bharti Airtel had already launched LTE services in Kolkata and Bangalore. Airtel, which had also acquired a 49 per cent stake in Qualcomm's BWA operations, is expected to be the strongest competitor for RIL in the LTE arena.
Tikona Digital Network, which has won 4G licence across five circles, and Aircel (eight circles) are the other companies finalising launch of the services by this year-end.
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