Credit Suisse said Bharti Airtel may be the best suited to handle competition from Reliance Jio Infocomm which is expected to unveil 4G LTE services in July.
A Credit Suisse report also said that the Mukesh Ambani company has some unique, distuptive strategies on its radar.
Sunil Mittal-promoted Bharti Airtel’s 4G LTE services are now available across India including Kolkata, Chennai, Bengaluru, Pune, Chandigarh and Amritsar.
“With 70,000-plus sites live, we believe the launch is nearing for Reliance Jio. We expect a soft launch by mid-July 2015, which would be earlier than the current market expectation,” said Credit Suisse in its report on the Indian Telecom sector.
In a separate analysis about its first impressions on Bharti’s 4G launch in Mumbai, the financial services consultancy said while the indoor coverage was patchy, the outdoor signals on the street were quite strong, with an impressive 35 Mbps download speed and 24 Mbps at the windows.
“Bharti clearly has the lead among incumbent operators of 4G deployments, and is probably best positioned to respond to upcoming Reliance Jio launch,” it said, analysing the early-mover’s soft-launch in Mumbai few days ago.
“However, given the scale of investments, network capacity size, and differentiating investments made, we believe even Bharti’s numbers could come under pressure in the next couple of years,” it added.
As regards Reliance Jio, Credit Suisse said the company has a two-pronged strategy — covering services, over which it feels the network channels were in place, and then device distribution, about which it says it expected company-branded instruments to hit the market with entry-level prices of $30.
“Operators in India do not sell handsets and devices — there are separate distribution channels managed by handset OEMs (original equipment manufacturers) and specialist logistics companies that do the same,” said the report.
“However, Reliance Jio is taking a different strategy and working on a dedicated handset distribution infrastructure given that having sufficient 4G handsets supply is critical for their business,” it said, adding it expected the company to start selling its devices before its 4G launch.
“From our discussions, we assume Reliance Jio’s internal target could be to sell two-thirds of all 4G smartphones sold in India through Jio’s own distribution network,” said the report and said it was aware of reports that scouting was on for this from China.
“We believe if Reliance Jio comes to the market with devices priced below $80-90, it could be quite disruptive for the market.”
Regarding Bharti, having said that its 4G service signals were weak indoors, the report said the data speeds were a lot to rave about when the signals were actually caught, turning out to be far more superior compared with the 3G speeds offered by Airtel’s own service and Vodafone.
“The experience on video was impressive — YouTube videos played instantaneously on Airtel LTE, while the same videos loaded with a 5-10 seconds delay on the 3G networks. True HD quality video played consistently on LTE, vs. frequent downgrade to SD video on 3G.”