RCom restarts 3G expansion after a five-year gap

rcomReliance Communications Ltd, the telecom arm of the Anil Ambani group, has again started expanding the availability of its 3G network after a gap of five years.

It was back in late 2010 — days after the company won 3G spectrum in the 2010 auctions, that it reached a milestone of 330 towns, making it one of the fastest roll-outs of the network by any operator in India.

However, since then, the company went into a freeze as far as its 3G geographic expansion was concerned as it battled financial difficulties and high interest liabilities due to the debt it incurred to buy the spectrum.

After nearly five years, the company still had a 3G footprint of 334 towns as of September 2015 served by 11,659 towers (average 3G tower per town – 35.)

However, in the last three months of 2015, RCom has added a whopping 190 towns to its 3G network. At an average of 30 towers per town, this should result in the addition of 5,700 3G base stations.

The company has also increased its capital expenditure target from Rs 3,000 cr to 4,000 cr for the ongoing financial year, largely due to 3G expansion.

The company said voice penetration is reaching saturation levels and it is now focusing on data services.

However, Reliance Communications added only 336 towers during the three months.

This seems to suggest that the incremental coverage of 190 towns have come from a partner.

During this period RCom has been reported to be in talks to ink 2G and 3G roaming agreements with Vodafone in five circles. The numbers, therefore, would suggest that the company has indeed signed an agreement with the British telco, though RCom has said that the deal is for 2G roaming only.

RCom said it has put in more 3G base stations in the circles where its 2G spectrum expired recently, and that it would soon start putting up new towers in other zones where it has 3G spectrum.

It said most the new towns required only 1-3 towers for coverage, which is the reason why the number of base stations has not increased by a lot.