Reliance Makes A Bid For Full Mobility Thru CDMA

Mumbai/New Delhi, December 24: | Updated: Dec 25 2002, 05:30am hrs
In a new twist to the ongoing battle between code division multiple access (CDMA) and global system for mobile communication (GSM) lobbies, the Reliance group is understood to have informally indicated its readiness to the Department of Telecommunications (DoT) to buy cellular licenses for fifth and sixth operator slots in circles where it is not present.

The Reliance move, however, has a rider: It will buy the cellular licenses, as and when they are offered, but use the CDMA platform instead of GSM. The consumer is technology neutral. What he wants is mobility. He is not concerned with anything else, sources connected with the exercise told FE.

Currently, there is a cap limiting the number of players in each cellular circle to four. However, Union minister for communications Pramod Mahajan has gone on record in favour of lifting the cap. The proposal is presently with the Telecom Regulatory Authority of India (Trai).

Sources said the Tata group, which has also entered the limited mobility sector with its Indicom brand, has evinced similar interests. However there was no confirmation from the Tatas.

Telecom secretary Vinod Vaish was unavailable for comment and sources close to Mr Mahajan said they were ignorant of any such proposal. DoT officials, when contacted, said they didnt have any information on the Reliance and Tata proposals. If these companies have made any such move, then it must be at a higher level, a top official who requested anonymity remarked.

The basic gameplan is to prove that the entry into WLL is not a backdoor entry by players offering CDMA services, simply because they did not pay license fees. In a recent media interview, Reliance group chairman Mukesh Ambani also made this clear when he said he was willing to pay a license fee and go fully mobile. He has been quoted as saying that if more mobility adds value, paying a license fee would not be a problem and that it was a business decision.

According to estimates, Reliance will have to shell out Rs 1,200 crore and the Tatas Rs 1,000 crore if they finally buy the licenses. Reliance has cellular licenses in West Bengal, Orissa, Madhya Pradesh, Bihar, Himachal Pradesh, Assam and the North East while Tata group, through the Birla-Tata-AT&T alliance brand Idea, is present in five circles including Delhi, Maharashtra, Gujarat, Andhra Pradesh and Madhya Pradesh.