Will RCom Open the 2G Voice /CDMA Channel to Reliance Jio ?

Reliance Communications (RCom) has already entered into three infrastructure sharing deals with Reliance Jio Infocomm – Inter-city optic fibre for Rs12 bn on-time payment, Tower sharing for Rs120 bn over the tenure of the agreement and Intra-city optic fibre for unspecified amount.

Till the time Reliance Jio’s own network coverage is wide enough, it is possible that RJio makes use of RCom’s network for voice in areas where its LTE network is yet to reach. In our analysis, such a deal can lead RCom to carry 30% of RJio’s voice traffic for few years by the end of which RJio could have their own network. Past experience of such deals shows that it could be low margin deal for RCom.

Reliance Jio could use RCom’s 3G /CDMA network to provide data and voice coverage in areas where LTE network is yet to reach. But sharing would require liberalised spectrum and only 3G spectrum would be eligible currently. The more lucrative CDMA spectrum will be required to be liberalised by paying market price to the government. (even here 10 circles have <=3.75 MHz of spectrum). Keep your fingers crossed until the Telecom Roadmap is unveiled by the new Government.