Aircel Gears up for 4G-LTE, Our Expectations

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aircel-4GBefore a storm, nature becomes too calm. In the midst of dull days at telecom we are expecting the tornado called 4G. The first 4G flight had taken off by Airtel but it is not a great journey so far. RIL Infotel is working on 4G to bring it in next 2-3 months and Tikona is scheduled for mid 2013. And there are media reports that say Aircel, which owns 4G spectrum in 8 circles is working on its 4G plans to roll out services in coming days. Aircel is currently in the process of finalizing device strategy, rolling out fiber optic and setting up 4G-LTE BTS in towers.

In next 6 months

It is highly anticipated that Aircel will roll out 4G services in 8 circles in not less than 6 months. Aircel, already cash-stripped with high priced 3G auction bought 4G spectrum in 8 circles. To encounter cash crisis Aircel is currently re-structures its business strategy in low-profit circles and scaling down operations in some circles. It is expected that to bring 4G with several trials and pilots, cable laying, finalizing device and service strategy Aircel will take a minimum 6 months, which may be stretched for another 3 months. But it will be great if Aircel starts 4G in 6 months in any city to showcase its 4G potentiality. It is highly anticipated that Infotel may roll out services in this financial year, before March 2013. Aircel may learn from Infotel’s strategy to bring world class services on LTE-TDD platform. Aircel may start its 4G journey from Chennai, the base of the company.

Learning mistakes from Airtel 4G

Airtel rolled out 4G-LTE in April 2012, but still response is pretty poor – less than 5,000 subscribers in Kolkata, Bangaluru and Pune. Airtel 4G has issues speed (only level 1 BTS in most places), coverage and tariffs. Aircel must look at these and try to bring better services on LTE.

Subscriber-attractive Data plans like Aircel’s Pocket Internet Packs

On mobile internet space, Aircel is a kind of pioneer to bring unlimited internet packs on 2G (Pocket Internet). On 3G Aircel offers all unlimited plans – certain usage on 3G and then unlimited on 2G. We expect Aircel’s 4G data plans will be similarly attractive to consumers.

Advantages as No Wired Broadband

4G-LTE can be a alternative to wired broadband, at least in India, which I told earlier. Unlike Airtel which has wired broadband services in selected cities Aircel does not offer wired broadband. This means Aircel 4G can be offered with better prices to compete with wired broadband services.

8 Circles include category C circles

Aircel has 20MHz of spectrum on 2300 MHz in 8 circles - Andhra Pradesh, Tamil Nadu (including Chennai), West Bengal, Bihar, Odisha, Assam, North-East, Jammu & Kashmir. Out of these 8 circles most of them are category C circles – that means Aircel has to offer 4G at a cheaper price to penetrate the market at tier II and tier III cities.. Also Aircel won the spectrum at these circles at a very low price compared to metro circles or 3G spectrum I don’t think that’s not a big problem for Aircel.

3G vs 4G

I think it’s a tricky question for Aircel as all of these eight 4G circles are overlapping with 3G spectrum also. So definitely cheaper 4G means people will be less attracted to 3G data. But at this initial stage of LTE-TDD voice options are limited, handsets are also limited – so LTE services may be limited to dongles and WiFi devices, so may not hamper phone users. Also 4G is for heavy data users, while casual users are good for 3G data.

Voice option

It is not sure Aircel LTE services will have a voice counterpart or not, but if others launching it, Aircel has to do it. As per reports Airtel is to conduct fall back mechanism for voice over LTE, while Reliance is trying voice over LTE using Russia’s SPIRIT DSP’s VVoIP engine.

WiFi Offload

Aircel is already offering WiFi services with Spectranet where billing are done from Aircel mobile. With 4G-LTE Aircel can launch its own WiFi Hotspots. It will help them to reduce network load on 3G and 4G and can offer cheaper data to consumers.Apart from simple data/internet services Aircel is also targeting home consumers by offering broadcasting, video on demand, education and health care services over LTE-TDD network.

Separate sub-brand for 4G

It is my personal opinion, simple Aircel 4G/LTE is not a good choice to promote LTE. Aircel Ultra 4G or similar sub-brand focusing young generation can be a good option.

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