4G telecom services heading for intense price war

Aggressive pricing and differentiated services in 4G are likely to swoop the market soon as the existing services providers, would like to garner subscribers before the partnership of R Com and R Jio shakes out the market.

Zee Media Bureau

New Delhi: Mobile telephony and data services on the fourth generation (4G) telecom technology are set to see aggressive pricing and differentiated services in the coming days.

Reliance Communications merger with Sistema Shyam TeleServices has landed extra airwaves in the  800/850 MHz band in thee company's kitty. With the available spectrum,  RCom will be able to deliver 4G services in 8 telecom circls.

As RCom's 4G spectrum sharing partnership with Relaince Jio will add to the muscle of both companies, the duo would clearly be able to influence the market dynamics, and pricing is set to become a differentiating factor.

Airtel had launched its 4G telecom service at the rates lower than rate for 3G services. This was to wean away 3G subscribers from the other networks.

However, experts say that due to high cost involved in the acquisition of airwaves, telcos are unlikely to indulge in price wars on the data front. Telecom companies are more likely to create differentiation on the basis of customer experience and service quality.

The 4G subscriber base is expected to rise sharply in India. As per Bank of America Merrill Lynch report, the Indian 4G subscriber base is estimated to reach 90 million by 2017-18, while the 4G smartphone base will jump from 5 million in 2015-16 to 180 million by 2017-18.

The report added that there will be a faster acceleration towards 4G with a large proportion of 2G subscribers leapfrogging 3G to move to 4G. The 3G subscribers to be largely restricted in areas where 4G coverage is limited, the report added.

The bidding pattern in the airwaves auction earlier this year also pointed to a growing data focus. The auction of almost 80% of airwaves in the 1,800 MHz band indicated operators' interest in rolling out services in the high-speed 4G services.

Currently, Airtel and Vodafone are offering 4G telephony and data services in India