Reliance Communications: Built to Succeed

India is the seventh largest country by geographical area and the second most populous country in the world. Its large population, low telephony penetration, and rising consumer spending power have made it the fastest growing telecommunication market in the world. As of April 2011, there were 826.93 million mobile subscribers in India, and that number is predicted to rise to 1.159 billion by 2013.

The market is very promising in India, and more than ten operators that exist there are engaged in cut-throat competition. Reliance Communications, the flagship company of Reliance Anil Dhirubhai Ambani Group (ADAG), stands out from most of its competitors. With a subscriber base of 128.87 million as of February 2011, it is the second largest telecommunication company in India and the 16th largest operator in the world. The company's vision is "to be amongst the top 3 most valued Indian companies by 2015; to provide information, communication and entertainment services, and to be the industry benchmark in customer experience, employee centricity and innovation." Reliance Communications has always been committed to cutting-edge technologies and cost-effective solutions.

Successful Strategy in the 2G Era

Although Reliance is the largest CDMA operator in India, it still offers GSM to support data services, diversify terminals, and enrich user experience. In 2007, Reliance was issued with a GSM license and embarked on its GSM journey.

Ever since the CDMA era, ZTE's innovative designs have deeply impressed Reliance. ZTE converged CDMA and GSM into one rack, significantly helping the operator decrease their network construction costs and shorten their engineering time. Reliance named the solution "combo box."

Figure 1. Combo box.

To tackle the problems of difficult engineering and poor coverage, Reliance adopted ZTE's SDR 8000 base stations with dual-density TRX units. They also adopted highly integrated indoor macro base stations from ZTE as well as the industry's smallest micro base stations and an all-IP indoor pico base station. These enable deep and seamless coverage in dense urban areas.

ZTE's innovative Netspeed technology assisted Reliance to achieve premium quality coverage in suburbs. This speeds up network deployment and reduces maintenance costs.

In rural areas, the ZXSDR 8000 BTS family satisfied Reliance's requirements for coverage, service capacity and future evolution. With distributed structure and intelligent power control technology such as intelligent carrier shutdown and intelligent cell shutdown, the ZXSDR 8000 BTS family easily adapts to its surrounding environment and substantially cuts down network OAM.

Reliance transformed its mode of operation from single CDMA to CDMA/GSM dual-mode. As of September 2010, the number of GSM subscribers was 6.205 million. This makes Reliance the second largest integrated telecommunications service provider in India. Reliance operates mobile and fixed networks, and offers broadband, direct distance dialing (DDD) and international direct distance dialing (IDDD). They also offer data services and value-added services.

Front-Runner in the 3G World

India's 3G spectrum auction concluded in May 2010. Reliance paid a huge amount of money for 13 telecommunication circles. The auction has created expectations for the next great wave of mobile connection growth.

However, there are still many people at the bottom of the consumption pyramid.

It is predicted that the largest source of income for Indian telecommunication companies in the next decade will continue to be voice services. GSM will continue to dominate the Indian market, with operators focusing their 3G strategies on urban areas and promoting subscriber growth by expanding 2G services into rural areas. Converged voice and data services enabled by 3G networks will become more significant in the Indian market as operators look for ways to address the falling profitability of voice services.

Cost-effective voice strategies have thus emerged as operators seek to exploit the efficiency of 3G to offer lower-cost voice services. This improves margins in a market where tariffs are so low. Cost-effective voice services benefit operators that have been forced to provide cheaper voice tariffs and improve their profitability.

Compared with other 3G operators, Reliance has no coverage gaps using 2G. In light of current trends, Reliance formulated the following strategies that take advantage of its nationwide 2G coverage:

• Optimize the original CDMA network, changing obsolete network architecture to improve competitiveness and solidify subscriber base
• Reuse the dominant CDMA network to deploy EV-DO
• Develop UMTS, EV-DO and LTE
• Prioritize resource allocation to UMTS.

ZTE's SDR base stations have a unified platform that shares baseband processing units and RF modules. GSM, UMTS, CDMA and LTE multimode networking can be fulfilled in one rack. Using the SDR base station, Reliance took a big step forward in 3G network construction.

• CDMA/GSM/UMTS/LTE BBUs and RRUs in one rack with large capacity
• small footprint to reduce OPEX
• cutting down power consumption by over 50%
• flexible network deployment
• smooth evolution to HSPA+/LTE
• commercial launch of MIMO to improve network throughput

After signing the contract with ZTE in August 2010, Reliance received 600 base stations within 30 days. The first 3G call was made after only eight days, and a record was set for the swap over of 1120 GSM base stations in 38 days and 952 3G sites in 22 days. Reliance had swapped over 2000 2G sites and 1100 3G sites by the end of 2010, and 8300 2G sites and 4000 3G sites by June 2011. The networks were also optimized. The greatly enhanced network performance brought about rapid growth in subscriber numbers. In Q1 2011, Reliance gained 3 million GSM subscribers, a 12% increase on the previous year.

In December 2010, Reliance announced the launch of 3G services in Delhi, Mumbai, Kolkata and Chandigarh, and it also plans to extend 3G coverage across the whole country by the end of 2011. This means that Reliance has become the second private telecommunication company in India to launch 3G services and the first to offer 3G services in India's three biggest cities―Delhi, Mumbai and Kolkata.

Winner in the Future

According to a report from Ovum, the number of 3G connections in India will grow to 142 million by 2015. This represents a compound annual growth rate of approximately 80% over the next five years.