ANALYSIS

Reliance Infotels 4G Plans

Multi-vendor and multi-technology complexities are forcing operators to move towards managed services Highlights
India lacks content to drive 4G data services India video surveillance market expected to reach `3,565 crore by 2015 M2M modules market to reach `547 crore by 2015 Reliance group itself is a potential 4G user Reliance Infotel to focus on enterprises services To focus on enterprise services like video surveillance and M2M communications

eliance Industries, in 2010, through its acquisition of Himachal Futuris c Communica ons, Infotel signaled its entry into the mobile broadband telecommunica ons industry. For `4,800 crore Reliance Industries acquired a 95% stake in Infotel. RIL paid an addi onal `12,848 crore as license fee for a 20 MHz spectrum across 22 telecom circles. This bold, strategic investment gave RIL, through the new en ty Reliance Infotel, a pan-India presence in the telecom sector. So, what should Reliance Infotel do with such a huge network, acquired a er making very substan al investments? Unfortunately, telecommunica on services havent done well in the India enterprise space so far. In spite of being the worlds second largest consumer mobile telephony market, enterprise services dont measure up to the advancements made in the

former. The India market has witnessed limited traction for enterprise telecom services, oered by various operators.

The Issues
Coming back to the issue as to what Reliance Infotel should do with its 4G network, as a rst step they have the opon of rolling out services for individual subscribers and/or enterprises. But, looking at the story of adop on of 3G services in the country so far, 4G is likely to follow the same route, at least in the individual subscriber space. Service oerings could either end up being priced out of reach at launch, making them unaordable for the larger base of subscribers; addi onally, availability of 4G-enabled smartphones and tablets would be a hindrance. So, for now, it may be ok for Reliance Infotel to not launch any services directly targeted at individual subscribers. Even when introduced, the

volume of traffic generated by use of applica ons such as YouTube, etc, is not likely to provide sucient growth impetus to a company of the size and scale of Reliance Infotel. Unfortunately, beyond Bollywood music/video clips and cricket, India s ll does not have enough indigenously generated, quality content to drive 4G data services growth.

The Options
Reliance Infotel has the op on of posioning itself as a BWA Internet Service Provider (ISP) across India wherein they could oer high speed broadband access through a CPE device that is shared by several users, say, a group of friends in a hostel, a cluster of apartments, etc. But for such a system to become popular and see high adop on rates, the individuals or families that make up a group need to display excep onal bond-

30 | VOICE&DATA | JULY 2012 | voicendata.com | A CyberMedia Publication

ANALYSIS

ing. Unfortunately, such arrangements have a history of not working very well in the long run. That is consumer behavior, for you! Further, the government is making this space increasingly complex by considering a bunch of programs together that could be poten ally used for delivering the same set of services. Examples include a digital addressable system for TV, national optical fiber network, ber to the panchayat, etc. All these are aimed at connec ng homes and individuals to a digital network over which the government could launch digital inclusiveness and digital empowerment programs.

Be it large enterprises, SMEs, or the ROBO 4G connectivity makes a strong business case for all
As per CyberMedia Research findings, the India video surveillance market crossed the `1,000 crore mark in 2011 and is expected to reach `3,565.1 crore by 2015 at a CAGR of 34.5%. The India machine-to-machine (M2M) modules market, though s ll a niche opportunity, stood at `134.6 crore in 2011, and by 2015 it is expected to touch `546.9 crore at a CAGR of 32.3% The growth trends exhibited above clearly translate into a sizable opportunity for providing reliable, high speed broadband communica on to serve both government/public sector and private enterprises by telcos. The key requirement is that the network serving these markets needs to be technologically robust and have wide reach and coverage. Reliance Infotels pan-India 4G network can easily serve as an informa on highway for enterprises for eec ve video surveillance and M2M applica ons. Be it large enterprises, SMEs, or the ROBO (Remote Office-Branch Office) segments of the market, 4G connec vity makes a strong business and technology case for all such organiza onal user groups. For instance, for city-level surveillance it is necessary that we have a centralized control room at na onal, regional, and state levels. Any poten al security threat needs coordinated eorts, some mes at the na onal level. With a 4G based network for such a naon-wide surveillance system police/intelligence, civic and paramilitary agencies can work in a coordinated manner, greatly aided by an electronic eye that surveys key urban centers, public places, and infrastructure facili es from a centralized base sta on.

Research Statistics
CyberMedia Research recently concluded studies in 2 relevant areasIndia video surveillance market and India machineto-machine modules market. Although, these markets have very dierent dimensions and characteris cs, both have some similari es as outlined below: Devices are connected 24x7 Data needs to be transmi ed in realme, con nuously There cannot be any down me, even for a frac on of a second Data volumes are high, par cularly in the case of surveillance Networks span over a wide area

Such levels of integra on of intelligent electronics systems at the na onal, regional, and state levels is very important to make the system useful and eec ve for users, trac management/law enforcement forces, civic services providers, and highway development agencies. This is only possible by deploying a pan-India 4G services network. Similarly, enterprises need to have wide coverage, high speed networks that allow monitoring of remote physical infrastructure via video surveillance, and connectivity to customers in case of M2M communica on applica ons. Another compelling reason for Reliance Infotel to launch such services over their pan-India 4G network is that the Reliance group itself could be a big poten al user. With a diversied business por olio and reneries, plants, oces, warehouses, and stores covering the length and breadth of the country, a 4Genabled video surveillance system could be a big mul plier in itself for increased opera onal eciency and greater collabora on amongst business teams.

Conclusion
As the market and the telecoms industry eagerly awaits for Reliance Infotels launch of 4G services, the challenges for Mukesh Ambanis team will be similar as those faced by 3G service providers in the country in the last 24 months. Keeping that in mind, it makes eminent sense for Reliance Infotel to focus their energies on enterprise services like video surveillance and M2M communica ons. This will not only enable Reliance Infotel to have a sustainable, high speed data services business running on their 4G network, but also usher in a new era of enterprise telecom data services adop on in India. This mantle would truly bet the Reliance groups philosophy of pioneering path-breaking products and services for the country.
Faisal Kawoosa and Rajat Kharbanda The authors are with CyberMedia Research semiconductor and electronics practice vadmail@cybermedia.co.in

Security Concerns
From the opportunity perspec ve both these markets are promising for Indian telcos. While, connected devices are closer to seeing adop on, monitoring infrastructure, public places, oces, urban commercial hubs, etc, is equally important with the persistent security concerns in the country. As the size and volume of physical infrastructure becomes increasingly widespread and complex, it throws up challenges in being monitored, maintained, and managed by direct human surveillance. Though, in terms of cost, physical human surveillance might s ll be a feasible op on for a country like India, that may not necessarily translate into eec ve surveillance at all mes.

32 | VOICE&DATA | JULY 2012 | voicendata.com | A CyberMedia Publication