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Rel Jio’s 4G entry not a threat: Idea

Himanshu Kapania, Idea Cellular's Managing Director. (Reuters photo)

Idea Cellular, the country’s third-biggest mobile operator with over 170 million subscribers, has joined the 4G bandwagon ahead of Mukesh Ambani’s Reliance Jio launch. Reliance Jio is expected to be launched commercially in March-April, while a soft launch for employees will take place on Sunday. While Bharti Airtel and Vodafone are also expanding their 4G footprint, Idea has forayed into the high-speed network from the southern states and is looking to scale it up to 10 telecom circles by March-end next year from four at present. TOI speaks to Himanshu Kapania, managing director of the Aditya Birla group company, to understand the company’s plans:

Did it take you long to decide as you are the last of top three incumbents to enter 4G?

It certainly has not been long as we made an announcement about our 4G plans in September this year. The 4G spectrum was originally auctioned in 2010 in the 2,300 MHz band, which was bagged by Airtel and Reliance Jio. We had participated in the auction of 1,800 MHz frequency, which happened in 2014 and 2015. We were deferring the launch to first sort out (spectrum) re newal issues, which we could complete only by March this year. Also, we were waiting for the 4G ecosystem (equipment and devices) to be ready.

So, how are you going about it?

We are starting with four telecom service areas of Andhra Pradesh & Telangana, Karnataka, Kerala and Tamil Nadu. By March next year, we intend to spread to 10 telecom circles, which will make us available to half of the country’s telecom subscriber base and 60% of Idea’s revenue subscriber base. Once we have an approval from the telecom department, we will also expand to Gujarat and UP (West) circles that we have recently acquired from Videocon through a spectrum trading deal.

 Industry analysts say there is a tough challenge for incumbent telecom players as cash-rich Re liance Jio can can give steep competition. Do you agree?
You have to understand that this business is a marathon, not a sprint. It is a massive infrastructure project and has to reach every nook and corner of the country.

If you talk about competition, the market structure is not as hyper in the 4G business as it used to be in the mobile voice area where we had 16 players in 2008-09 and still have to fight it out with 8-10 telcos. In 4G, we will have mainly about three to four operators in competition, such as Airtel, Reliance Jio, Idea and to some extent Vodafone. Currently, there are around 90 million users on 3G and we believe that in the next four to five years, the number of people on the high-speed 3G and 4G networks will go up to 400500 million as data tariffs fall and devices get cheaper.This is a big opportunity.

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