Mumbai, April 30 (Agencies): Reliance Industries has tied up with another telecom rival, Vodafone, to build an undersea cable system across the Indian Ocean to connect Southeast Asia with West Asia.
Mukesh Ambani’s Reliance and Vodafone Group Plc have formed a consortium with four other players for the proposed 8,000-kilometre Bay of Bengal Gateway cable, which will link Malaysia and Singapore to West Asia and have connections to India and Sri Lanka.
Vodafone is the third deal Reliance had signed with its rivals in telecom this month — after Sunil Mittal’s Bharti Airtel and Anil Ambani’s Reliance Communication.
“Consortium members — Telekom Malaysia Berhad (Malaysia), Vodafone Group (UK), Omantel (Oman), Etisalat (UAE), Reliance Jio Infocomm (India) and Dialog Axiata (Sri Lanka) — signed the construction and maintenance agreement and the supply contract for BBG (Bay of Bengal Gateway) in Kuala Lumpur today,” Reliance Industries said in a statement.
Reliance Jio Infocomm is the telecom arm of Reliance Industries.
The cable system is expected to carry commercial traffic by the end of 2014, it said.
The statement said BBG would serve as an opportunity for business growth as it would help to support current and future high capacity requirements from the surrounding areas of the region.
“The BBG cable system is designed to provide upgradable and transmission facilities by adopting the state-of-the-art 100 Gbps technology,” it added.
The new cable system is significant for energy-focused Reliance as it readies the launch of the fourth-generation (4G) telecom services in the world’s second-biggest telecommunications market and is looking for international bandwidth.
The move also illustrates how Indian carriers are investing to build wireless data networks in a market where more than 80 per cent of the carriers’ revenue are still from voice calls. Data services are growing much faster in India where just a tenth of 1.2 billion people use the Internet.
Carriers in India spent a combined $20 billion to buy 3G and 4G airwaves in the 2010 auction.
Reliance, the only company in India to have nationwide permits for 4G services that enable high-speed wireless Internet, is widely expected to launch the services later this year and is sewing up deals with rival carriers.
Just last week, Reliance had signed a deal to lease undersea cable capacity from Bharti Airtel on the Chennai to Singapore route.
Earlier this month, Reliance Industries said it would lease inter-city optic fibre capacity from Reliance Communications, owned by Mukesh’s younger brother Anil.
Bharti Infratel, the tower arm of Bharti Airtel, today said it would talk to Reliance Jio Infocomm to lease out its towers, a top official of the company said today.
“We would definitely be in talks with them, we would like to do more and more business with them. As far as we are concerned... they are a very credible customer, so we would definitely be in touch with them,” Akhil Gupta, vice-chairman and managing director of Bharti Infratel, told reporters.
He was replying to a question if Bharti Infratel was in talks with Reliance Jio Infocomm for tower sharing.
Gupta, however, said no contract was being signed at the moment.
“As a tower company, its my job to go to every operator, existing as well as prospective,” he said.
Reliance Jio Infocomm already has a deal to use Bharti’s submarine cable network to provide data connectivity across Asia Pacific.