Indian Carriers To Invest $1.5B In Network Expansion By 2020

Jio Reliance Logo Blue 2018

To cope with the recent surge in data consumption and stay equipped for the incoming rollout of 5G, telecom giants in India are reportedly planning heavy investments in the country over the next couple of years. A major portion of the newly estimated $1.5 billion figure will be committed to network expansion to help current and future communication technologies cover as many of 1.3 billion Indians as possible. As per recent reports, the South Asian country currently has about 450,000 base stations with all carriers combined, and with this planned investment, that number is set to reach 850,000 by the end of 2020. India presently has four major telecom operators – Airtel, Vodafone, Idea, and Jio – with Vodafone and Idea being in the final stages of their merger, forming the largest carrier in the country. Once consolidated, the new carrier is expected to have a customer base of 410 million, about 42-percent of the total market.

With the new target in mind, the companies will have to lay an enormous fiber network to have the new base stations up and running. According to some industry analysts, only 15-percent of all base stations in India are connected by fiber cables, while rest depend on microwaves for data transmission, which will likely become insufficient to manage the next major surge in data usage. Laying new fiber cables at the needed rate would cost a fortune and isn’t a viable option for the debt-ridden telcos that are already facing stiff competition from the new entrant Reliance Jio, a venture of India’s richest man Mukesh Ambani. This has forced the companies to look for alternate means to support rapidly increasing mobile data consumption in the country on their existing networks. Both Airtel and Jio recently deployed pre-5G Massive MIMO infrastructure around a few venues of the Indian Premier League (IPL) cricket series in New Delhi and Mumbai to account for large crowds at those locations. Besides 5G, the carriers are also exploring LTE-Advanced and cloud RAN (C-RAN) technologies which they are likely to roll out in the near future, along with the rest of the world.

Reliance Jio entered the market a couple of years back to disrupt the industry by initially offering absolutely free access to unlimited 4G data for several months, then by commercially launching its service at one the world’s cheapest rates. This allowed the company to gain 100 million paying subscribers in a matter of 170 days. Airtel, Vodafone, and Idea had to follow suit to keep their subscribers from switching to Jio, bringing the data prices to their lowest, thus benefiting their customers at the expense of their bottom lines. Under one of its monthly prepaid plans, Jio is offering 42GB of 4G data (with an FUP of 1.5GB per day) at Rs. 149 ($2.26) with unlimited calling and messages throughout the country, while a basic monthly postpaid plan from Jio priced at Rs. 409 ($6.22) provides 20GB of data (without any FUP) with unlimited calls and SMS. All other major telcos now offer plans with a similar set of benefits and pricing, consequently driving up data usage in India.