Sonesh Surana, writing on the email list at Berkeley's TIER project, points to this Rediff article on Reliance's rural Cellular strategy. Some key points:
- Reliance CDMA networks already covers 42% of the rural population and they expect to reach 50% (and 400,000 villages) by end of 2006.
- Reliance offers 144Kbps mobile connectivity (using CDMA2000 1x technology) in 3600 towns; GSM providers offer 56Kbps in just 25 towns.
- Rural subscribers in 1xRTT areas are using their cellphones to access Internet !
- Reliance is encouraging 2nd-hand sales to push data-enabled phones into the rural market.
This is fascinating. The official government approach to rural connectivity has been a series of programs to foster village public telephones and encourage universal service (or at least collect taxes for a Universal Service Obligation Fund). These programs have typically specified exactly what is to be done including the technology to use in exchange for subsidizes (to a single provider in each region). Given rural teledensity, it's fair to say existing programs have failed.
Now along comes Reliance, with a service that not only doesn't get subsidies, but has pay taxes and make money, and they are succeeding despite being penalized by the government!
Note: all Indian telecom operators are penalized with telecom-specific taxes at rates far about most other countries (e.g. 5x that of China). Beyond that, technology-specific regulation grants less spectrum to CDMA operators like Reliance than to GSM operators, basically punishing them for being more efficient.
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