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  • Reliance Industries likely to foray into the telecom space

    Reliance Industries, headed by billionaire Mukesh Ambani might be gearing up to enter the telecom sector.

    After the cancellation of 122 licenses by the supreme court earlier this year in February, the government is all set for the auction of the vacant 2G spectrum and the application process for the same starts from September 28. Once the application process gets over, the auction of licenses must begin by November 12.

    Government has plans to auction airwaves frequencies in 1800 Mhz (GSM) band and 800 Mhz (CDMA) band which are being used for the mobile telephony services.

    In the auction of 1,800 Mhz spectrum for the GSM networks, existing operators will be allowed to buy as many as two blocks of 1.25 megahertz each whereas new entrants will be required to bid for a minimum of four blocks each of 1.25 megahertz.

    In the auction of spectrum in the 800 Mhz (CDMA) band, three blocks of 1.25 megahertz each will be sold.

    RIL entered the telecom sector after abandoning their non-compete pact with Reliance Communication (RCom) back in 2010, when it acquired Infotel brodband which had won pan-India spectrum for offering high speed internet broadband.

    The company has already revealed its plan to use LTE (Long term evolution) technology for its country wide network deployment but is yet to start its services. RIL has already said that it wants to add voice capabilities to its data oriented LTE systems when goes live.

    With Mukesh Ambani's RIL entering into the telecom space, it would mean a direct, head to head battle with Rcom which is owned by Anil ambani . This could be the first time, the two brothers would be pitted directly against each other, after the big split in 2005.

    RIL's entry into the telecom sector will certainly intensify the already cut-throat competition. If RIL manages to win the 2G-spectrum auction bid, it will be able to provide voice cum data services to its consumers, which will give it an upper hand over others.