Disappointed with 700 MHz pricing: Vodafone

After launching 4G services in 5 circles, Vodafone India started the services in Mumbai on Wednesday, starting with Western suburbs and South Mumbai. The company intends to complete its first phase of rollout by March 31 across the major cities in the country. In an interaction with BusinessLine, Vodafone India Managing Director and Chief Executive Officer Sunil Sood talked about the company’s roll out plans, spectrum pricing and offering voice telephony over LTE (4G technology) network. Edited excerpts:

When will the second phase of 4G rollout start and which are the cities Vodafone is looking at?

Once we complete the first phase of rollout by March 31, we will divert our attention to the next circles, which will start only on April 1. We haven’t announced those circles yet.

You are not providing Voice over Long Term Evolution (VoLTE) along with the 4G services? Is it because the eco-system is not ripe for it?

We are already providing High Definition voice and HD content (pictures and video) through our 4G services, which are not VoLTE services. We don’t need to have to it right now and if in future if the technology evolves, then we will go about investing in it. A lot of handsets in the market are not VoLTE-enabled, and as it is we have limited 4G subscribers with 4G devices. Only 4 per cent of my base currently has 4G phones, while that in Mumbai is at 15 per cent. For VoLTE, the eco-system is still a little immature, but it’s getting there.

The industry cried foul over Telecom Regulatory Authority of India’s reserve price for 700 MHz spectrum, terming it “unrealistic”. Your comments.

We are very happy that TRAI has recommended auctioning of all the spectrum bands that were available — 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz — is a positive step. With the government’s ‘Digital India’ initiative and key vision of our Prime Minister for the common man and companies, whether its app developers or internet companies, broadband capability is the need of the hour. So, we have been disappointed in the valuations of the 700 MHz spectrum.

TRAI has called for public-private-partnership in rolling out Bharat Broadband Network Ltd (BBNL)? Would Vodafone be interested for BBNL?

Yes, we want to participate. We made certain presentations to the government on how to make broadband cheaper and spread it across the length and breadth of the country. Now, it is up to the government on how they want to do it.

The regulator came heavily on differential pricing, stating many of these were illegal and had asked operators to withdraw them. What is your stance on this?

We believe that a certain kind of a leeway should be given to propagate data usage, especially in India. The same service should have the same rules, we believe in that. We didn’t venture into providing any of these, and we will abide by the rules of the game.

Revenue growth for many operators slowed down in the third quarter, is it impacted by pressure on data services?

Let’s not get into specific quarters, because there are different moves by different operators and cyclical effects, and then companies are rolling out sites. There is also a net affect, while we are gaining in 3G, we would be losing on 2G and the 2G user would be migrating to 3G or 4G. On a year-on-year basis, we have grown data by 55 per cent, and added 8 million subscribers in 3G data. I don’t think that’s a small number.

Vodafone India had earlier stated spectrum is a scarce resources and the company would be looking at trading and sharing of the airwaves?

At Vodafone, we believe, we don’t have enough spectrum and we would like to have lot and lots more spectrum. It doesn’t matter whether we get through auctions, spectrum trading or sharing, we will look at each one of these avenues to increase our pool of spectrum. In cities such as Cairo and Giza, which combined population similar to that of Mumbai, has less than 2,000 cell sites to cover the whole city. That is because they have spectrum, which is in the right quantity. In Mumbai, we have 5,000 cell sites to cover the whole Mumbai on 2G alone. That’s the difference spectrum can make. I could have reduced with footprint with good spectrum to about 40 per cent, therefore conserving power, reduced number of cell sites and able to provide a better experience to customers.

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