GSM operations update
GSM network coverage is almost at par with that of CDMA. Management indicated
that post the phase-out of initial GSM promotional schemes, customers are
increasing usage and recharging beyond the free minutes. ARPU is thus gradually
normalizing; further scale-up in usage is expected over the next few quarters.
Competitive intensity manageable
Entry of new operators is unlikely to be disruptive. Tariffs are already competitive
and have ceased to a differentiator to attract customers. New operators also lack
the scale of marketing & distribution and brand presence enjoyed by incumbents,
which is a material drawback. Management indicated that Reliance Infratel is
currently in negotiations for tie-ups with new operators for tower-sharing.