Reliance Communications’ Rs 1500 crore Capex to focus on 3G data growth in FY 2014

Telecom Lead Asia: Reliance Communications says its planned Capex (capital expenditure) of Rs 1500 crore in fiscal 2014 will focus on enhancing coverage and data capacity on its 2G, 3G and high speed data network, building additional capacity in data centers, providing fiber optic backhaul on greater number of sites.

Reliance Communications has invested Rs 341 crore on Capex during the fourth quarter of FY 2013.

Reliance Communications, promoted by billionaire Anil Ambani, is increasing its focus on data growth, and providing high speed data coverage in over 1,300 towns in India.

Thanks to its data focus, Reliance Communications has 29.4 million data customers till March 2013. Out of this, 7.2 million are 3G customers.

Reliance Communications’ non-voice revenue contribution to wireless revenues is 21 percent.

The growing smartphone adoption has assisted Reliance Communications to reach data usage on its network at 27,240 Terabyte and data usage per sub at 319 MB.

Reliance Communications’ data usage rose 21 percent quarter on quarter.

The company says the large traction in data usage is coming from higher usage on social media sites such as Facebook, You Tube and What’s App.

Its tie up with Facebook and Whats App is helping first timers accessing limited data on their mobile in the initial days and later on becoming a full-fledged data customer.

Reliance Communications’ strategy of giving Internet at low cost to customers on superior HSD & 3G network and converting them into higher revenue generating  data customers is working well.

Reliance Communications is already taking the lead in the phone bundling initiatives in India. The mobile operator has launched proprietary GSM and CDMA tablets at attractive price points and tied up with leading handset providers to launch CDMA smart-phones at affordable prices.

For instance, the company has an exclusive partnership with Lenovo to launch a complete range of smart-phones across screen sizes and processor speeds.

In addition, Reliance Communications forged relationship with handset manufacturers like HTC, Blackberry, etc. to provide innovative products and services on its Built for Internet network.

Gurdeep Singh, president and chief executive officer (Wireless), Reliance Communications, has admitted that calendar year 2013 has begun on a positive note for the handset ecosystem with the launch of affordable smartphones.

Earlier, lack of availability of cost effective handset was a hurdle in the growth of both 3G and mobile broadband in India.

“Since India has less than 10 percent smartphone penetration as compared to 35-40 percent in other developing countries, India needs to do a lot in catching up with data products and services resulting in substantial contribution from data in overall wireless revenues,” Singh added.

The other growth driver for 3G and other data services is the attractive buying options and discounts offered by major phone brands.

In the last six months, phone brands such as Samsung, Apple, Nokia, BlackBerry, Sony, etc. have offered attractive EMI options to attract Indian mobile phone users.

The primary aim of these discounts and buying options were to attract large middle class segment to adopt data service and start exploring fast internet experience on high speed data networks.

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