Reliance Preps $260M Enterprise Data InitiativeReliance Preps $260M Enterprise Data Initiative

In an effort to boost its data services revenues, Reliance Communications Ltd. plans to invest 12 billion Indian rupees (US$257 million) on a new wireless data network dedicated to business customers, especially small and medium-sized companies, the operator tells Light Reading.

Although Reliance is keeping many of the details secret at this point, the operator plans to roll out its new support infrastructure and "high-speed data" connectivity service in 40 Indian cities, and is building the service around its existing mobile network.

"The Reliance HSD solution is basically a high-speed wireless service provided by using a separate carrier [channel] of the company's CDMA 1x network," says Vrajesh Shelat, the operator's head of wireless data business. "The customers would need a router and a HSD card, and then it is just plug and play," with the router providing the data backhaul connection for the business customer's local area network, Shelat adds.

Reliance plans to source and rebrand routers and sell them to its business users, but will also initiate an open-market sales channel for end user routers that have been tested and approved by the operator.

The routers will enable a range of services, including secure WiFi connectivity, VPN functionality, redundant connectivity, and more, says Shelat. He notes that some routers, such as those sourced from SMC Networks Inc. , will be able to support multiple enterprise services, while others, such as a D-Link Systems Inc. router, will support only WiFi connectivity.

Commenting on the challenges being faced by operators in the data services sector, Shelat identifies the cost of sourcing the appropriate hardware as limiting, while low PC penetration in India will also limit potential uptake.

Reliance believes its data services will be most suitable for companies operating in the banking, financial services, and insurance (BFSI), fast-moving consumer goods (FMCG), retail, manufacturing, logistics, and transport verticals.

Developing a data services strategy is a key focus for most of India's mobile operators as the average revenue per user (ARPU) from voice services decreases due to increasing competition and the introduction of per-second billing.

As a result, the mobile operators, who have been very focused on building their subscriber numbers, are now turning their attention to the development of new services and revenue streams. (See Reliance Offers Email Via SMS and India Ends 2009 on a Mobile High.)

And they're keen to tap the growing market for data services before that market, too, suffers from margin pressure: Informally, many in the industry believe that the current voice services tariff war is likely to spill over into the data services market. (See Indian Operators Battle Brutal Market.)

Reliance, though, is keeping its aspirations close to its chest: Shelat declined to discuss the operator's data services customer numbers or its data services ARPU.

— Gagandeep Kaur, India Editor, Light Reading