RCom postpaid and prepaid subscribers can now get 3G services in all 22 circles across India. Move expected to boost RCom's postpaid subscriber revenues
Reliance Communications (RCom) has entered into a revenue sharing agreement with mobile operators, Tata Teleservices (TTSL) and Aircel, to offer pan-India 3G roaming services to its prepaid and postpaid customers.
While RCom offers 3G services in 13 out of 22 circles in India, Aircel has 3G spectrum in 13 circles and TTSL has the spectrum to roll out 3G services in nine circles.
Commenting on the partnership, Gurdeep Singh, chief executive officer, consumer business, Reliance Communications, said, "We are delighted to be the first operator to offer 3G national roaming to our customers in partnership with other telecom firms having state-of-the-art 3G networks. These alliances will further consolidate RCom's position as the leading data operator in the country and will help the company improve its post-paid and corporate customer market share."
For the quarter ended December 31, 2013, RCom had 36.2 million data customers, including 11.1 million 3G customers – the highest in India. Aircel and TTSL do not provide break up of their 3G subscriber numbers.
3G inter-circle roaming (ICR) arrangements are currently not allowed by the government, and Bharti Airtel, Vodafone and Idea Cellular are embroiled in a legal battle for offering 3G roaming to each other's customers and in that way acquiring more 3G customers as well. However, an RCom spokesperson clarified that this partnership for 3G roaming was only for RCom's existing 3G customers, and no subscriber additions would result from this arrangement.
RCom did not disclose details of the revenue sharing agreement between the three telcos. TTSL and Aircel stand to gain from the additional RCom subscribers being automatically latched on to their network in their 3G circles, while the 'smart capex' option for RCom can benefit from increased 3G revenues for the company, even as 3G tariffs would remain unchanged for its subscribers.
However, last year, RCom had increased 3G tariffs by 26% and reduced benefits on internet packages by up to 60%. With the new tariffs, RCom's 3G tariffs – which the company claims is still 40% cheaper than its peers, 3 GB costs Rs 492, 1.5 GB costs Rs 246, 1GB 3G data costs Rs 156, and 400 MB costs Rs 123.
Last week, RCom said it would increase its 2G call tariffs by 20% across its circles of operation, effective April 25, to offset rising costs of operation. The company also recently signed its third agreement with Reliance Jio for intra-circle roaming, after its earlier joint agreements for inter-circle roaming and tower sharing.
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