Friday, October 19, 2007
Almost a year and a half ago, when Anil Ambani suggested that he will go GSM for Reliance's expansion, it did not make too much sense since -
- the CDMA infrastructure was already rolled out in a lot of places
- dual access to GSM and CDMA was unprecedented in India
Reliance started its GSM rant after talks with QCOM on reducing royalty rates did not go its direction. Reliance perhaps felt that the operational costs for its CDMA networks were high compared to GSM. So amidst all fan-fare and collaboration efforts with QCOM through this year, Reliance obtained the nod from the Information technology minister, A.Raja, to offer GSM services as well. With 18% market share, and deep pockets, Reliance is suitably positioned to exploit the Indian mobile market. With its potential move to GSM, Reliance seems to have further marginalized CDMA2000 and its descendents in India. It does not seem to be posturing since Reliance was quick to pay the Rs.1651 crores needed to stay to make its GSM roll-out a reality. Now, is that good or bad for QualComm?