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Reliance Infocomm eyes mobile data market
By siliconindia
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Thursday, 09 October 2003, 19:30 IST
BANGALORE: Reliance group, which has signed up four million customers for its cheap mobile phone service since its December launch, now wants to woo more users with multimedia services such as video downloads and Web surfing.
India's middle class of about 300 million people is a potentially huge market for these high-speed mobile data services, but their real popularity and profitability will be tested only when companies begin charging for value-added features, analysts said.
"We are rapidly expanding our services such as movie clips, news downloads and video trailers to attract new users," said Reliance Infocomm president (application services) Mahesh Prasad.
Reliance Infocomm Ltd uses CDMA technology, the dominant wireless standard in US networks and parts of Asia.
Aided by an advertising blitz and cut-rate tariffs, Reliance has won over roughly 18 per cent of India's 22 million-plus mobile users, most of whom use the competing GSM platform.
Its GSM rivals Bharti Tele-Ventures Ltd, 16 per cent owned by Singapore Telecommunications Ltd and the local mobile phone unit of Hutchison Whampoa Ltd also offer multimedia messaging and high-speed Internet.
Reliance has put in place a 60,000-km terabit fibre-optic network and aims to eventually offer services in 700 towns and cities from 470 now.
Prasad said the firm had extended the free trial offer of its Java-based multimedia and data services to customers until March 2004. It had planned to end the promotion by October 1.
"There's still so much to do on a trial basis and we are in the process of rolling out a wide range of new services, he said, adding that the company was in talks with film production and consumer goods firms to develop and market new applications.
The Mumbai-based company gets an average 30 million hits per day for such services, nearly four times the number in June. It offers about 85 applications.
"Entertainment is the sweet spot in India. Reliance is using this to drive such services and it probably has the first-mover advantage," said Gartner India's principal analyst for telecom services, Kobita Desai.
"But many consumers are using these as they are free. The test would come when these services become chargeable."
Voice tariffs as low as Re 1 a minute and low-priced handsets are attracting new users.
Telephone penetration in India, including fixed-line phones, is just five per cent, against the global average of about 15.