4G action to pick up with Aircel foray by year-end

The battle for the 4G telephony market has hotted up, with Aircel investing $500 million (about Rs 2,757 crore) to launch its services between October and December. The company, which has spectrum in eight circles, will start rolling out 4G services from Chennai and other cities of Tamil Nadu.

Aircel will take on Airtel, which has already launched services in a few cities, and Reliance Infotel, which is expected to get off the ground by the end of this financial year.

Sandip Das, CEO of Malaysian telco Maxis Berhad (which controls a majority stake in Aircel), says, “Our focus is on creating a big data business. We’ll award contracts for 4G equipment soon and launch between October and December. We are putting in $500 million. We’ll be an integrated provider of 4G services.”

Das says Aircel will not only provide mobile 4G services through dongles and devices but also get into consumer homes by offering broadband internet, broadcasting, video on demand, education and health care services, among others. It is already working on creating a fibre optic backbone — partly by leasing and partly by investing on its own. The company’s strategy is more or less akin to that of Reliance Infotel, which is also looking to be an integrated 4G player.

The Maxis chief says it is, however, not looking at being an all-India player in 4G or going through acquisitions. It would prefer to be a large data player in certain circles. Asked whether 4G prices would be high like those for 3G, a key reason why subscriber numbers have not come, Das says, “We have already equalised our 2G and 3G tariffs and have over a million subscribers. With China and India dominating the LTE market, we’ll see prices of devices fall.”

On speculation that the telco is up for sale and has been approached by buyers like Sistema, Das says Aircel is open to the idea of going into a strategic partnership, which could include having financial investors, but would continue to hold a majority stake in the company. “We are open to strategic partnerships in technology or get in financial investors to meet our objective of creating a powerful entity in data growth. Preferably, we would like to be in control of the company,” says Das, adding that bankers always make offers.