Reliance Plans To Launch Rural Variant Of Wireless Internet Service

[Arun 795]

Economic Times

3 Feb 2009, 2250 hrs IST

In a bid to challenge state owned telco BSNL's dominance in rural circles, Reliance Communications (RCom) plans to launch a rural variant of its wireless Internet service – Net Connect with a tariff benchmark of below Rs 500.

For the rural rollout, RCom has tied up with the Chinese telecom infrastructure company, Huawei as the equipment supplier, the price of which is unlikely to be subsidized for the rural circles, according to company sources. This might prove a dampener as affordable equipment is primary requirement of rural space.

Currently, Bharat Sanchar Nigam Limited (BSNL) is the largest player in rural space with over 50% market share, while private operators account for a miniscule share. However, RCom has ambitious plans to capture about 30% market share of the rural Internet subscriber base over the next one year. The company has already shipped over 2 lakh equipments for the first phase of rollout, company sources said. The company is targeting the home user segment to capture the dial-up users.

The company will launch services through its existing network in 400,000 villages and 20,000 smaller towns in a phased manner. The services will be available to customers in rural areas in 14 circles before the end of this month, while the first phase is set to start in a week.

When contacted an RCom spokesperson said, "We continuously evaluate options to enhance the value proposition of our products and services to our subscribers across India, however, we would not like to comment on this."