RCOM’s CDMA customers will get 4G from May

Reliance Jio and RCOM have entered a spectrum trading-cum-sharing deal which requires them to move the CDMA customers to 4G

Reliance Jio and RCOM have entered a spectrum trading-cum-sharing deal which requires them to move the CDMA customers to 4G (Wikimedia)

Reliance Communications (RCOM) is all set start upgrading CDMA customers to 4G LTE from May 2016, it informed the government on Thursday.

Industrialist Anil Ambani-led RCOM will upgrade to LTE using liberalized 800 MHz spectrum under Jio sharing agreement, the company told the government in a letter, an official source told IANS.

The communications services companies of the two Ambani brothers in January announced agreements for trading and sharing of scarce airwaves, or radio frequency spectrum, in the 800 MHz band, covering the entire country.

RCOM had paid ₹5,383.84 crore to the government as fee toward spectrum sharing and trading in 16 circles for the 800-850 MHz band.

The companies got a shot in the arm, after the government approved changes in the policy where telecom spectrum or airwaves were allotted administratively rather than auctioned, to arrive at the market-determined price for the scarce resource.

"Jio and RCOM have entered into a spectrum trading-cum-sharing deal across most markets which requires RCOM to liberalise its spectrum before sharing. However, there were four markets which did not have an auction-based price and hence the necessity of the policy decision," the global banking and financial services company Deutsche Bank Equity Research said in a report.

The two companies were already sharing spectrum in 17 circles. Only four circles were left -- Rajasthan, Kerala, Karnataka and Tamil Nadu.

"We have estimated the cost of liberalisation at ₹55 billion for RCOM. The department of Telecom has a 45-day period to approve the sharing of spectrum after the operators file for such a request. We expect Jio and RCOM to file for sharing immediately," it added.