Reliance Jio awaits spectrum integration with RCom for 4G launch

NEW DELHI: Reliance Industries is awaiting the integration of spectrum that it expects to get from a sharing-and-trading pact with Reliance Communications (RCom), besides scaling up its user base to a few million before launching its much-awaited but delayed 4G telecom service.
Announcing its Q4 earnings for 2015-16, the Mukesh Ambani-controlled company said its telecom unit, Reliance Jio Infocomm, aims to achieve 90 per cent population coverage before starting commercial operations and added that it’s already around the 70 per cent mark.
"We are testing Reliance Jio on half a million users and want to scale it up for a few million users before we launch the service commercially," Anshuman Thakur, head of strategy and planning at Reliance Jio, told reporters on Friday.
Jio’s average data consumption per user exceeded 18 GB within the first month of service and is increasing. Average voice usage was over 250 minutes in the period. The company is widely expected to launch commercial services by December, after having started trials with its staff and partners on December 28, 2015.
"Beta trials will be transitioned to a commercial rollout at a later date," Thakur said, adding that a commercial launch date hasn’t been decided. Thakur said spectrum integration was a factor being considered for the commercial rollout.
Jio signed a pact with RCom, owned by Mukesh’s younger brother Anil, to share 800 MHz airwaves in 17 circles. Approvals for nine — Mumbai, UP-East, Madhya Pradesh, Bihar, Odisha, Haryana, Himachal Pradesh, Assam and the Northeast — came in from the telecom department on Friday.
RCom has also agreed to sell 800 MHz spectrum — considered very efficient for 4G services — to Jio in nine areas. The agreements are an effort to leverage each other’s spectrum holdings to launch high-speed mobile broadband services, or 4G, across India and take on top incumbents Bharti Airtel, Vodafone India and Idea Cellular.

"In the nine markets where DoT allowed RCom and Jio to share 4G airwaves in the 800 MHz band on Friday, the spectrum integration can technically happen in under a fortnight," an analyst at a foreign brokerage said.
However, Jio and RCom are likely to wait for DoT approval to activate their nine-circle spectrum trading deal, which is "expected very shortly", to ring in 4G services in key markets such as Delhi, Kolkata, Gujarat, Andhra Pradesh, Maharashtra, Punjab, UP-East, UP-West and West Bengal. After approval, RCom can transfer the right to use its 4G spectrum to Jio in these regions.

Both may also seek early approval to share 800 MHz airwaves in eight remaining circles.
RCom’s stock gained 5.5 per cent to Rs 56.95 at the close on BSE. The 30-share Sensex fell 0.16 per cent.
Reliance said it will spend an additional $4.5 billion ( Rs 30,000 crore) in capital expenditure in this financial year, while its debt would stand at Rs 33,000 crore. The government may sell 3G and 4G airwaves, including spectrum in the 700 MHz band, in an auction in July.

RIL chairman Ambani has previously said Jio is the world’s biggest startup, with an investment of over Rs 150,000 crore, which would offer broadband speeds that are up to 80 times faster than current offerings at affordable rates.
On Friday, RIL said Jio’s customer offering is built on four key strategic dimensions — "widest coverage of LTE services, substantially superior network quality, transformational data capacity and affordable services."