Indian mobile service provider Videocon Telecom today announced that it invested Rs 130 crore as Capex (capital spending) for upgrading its network to 2.75G EDGE.
Incidentally, telecom operators such as Vodafone India, Idea Cellular, Reliance Communications, Bharti Airtel and Tata Docomo are heavily spending on 3G networks. Videocon, a 2G operator, is unable to compete with 3G players.
Also, the Capex of regional players such as Videocon Telecom, Uninor, MTS India, etc. is low as compared with national telecoms such as Idea Cellular. The Aditya Birla group firm invests nearly Rs 3500 crore for its telecom expansion on pan India basis.
Videocon Telecom, Uninor and MTS India have slashed their Capex since they were forced to shut down operations in several circles following the Supreme Court order on 2G spectrum license.
“With approx 80 percent of mobile data users on 2G handsets, there is a large audience that can be catered with an advanced technology at 2G rates,” said Arvind Bali, director and CEO of Videocon Telecom.
The 2.75 G EDGE network is capable of delivering speeds up to 473.6 Kbps which is almost 6 times the maximum speeds delivered by conventional 2G network. Videocon needs to depend on 2.75G because it does not have 3G license.
The main strategy of Videocon Telecom to upgrade to 2.75G EDGE Network is based on the fact that nearly 80 percent of mobile internet users have 2G handsets and can be catered to by an enhanced 2.75G EDGE network.
3G telecoms offer 3G networks in select pockets, which deteriorate the customer experience while moving from 3G pocket to 2G network, said Videocon Telecom.
The 2.75G network upgrade will enable Videocon Telecom to offer 3G like experience to its customers at 2G rates on existing 2G handsets, without upgrading their handsets.
The telecom service provider plans to spend approx Rs 50 crore on the 2.75G network promotion campaign in next few months.
Videocon Telecom said it posted 51 percent growth in its daily data consumption. Mobile data users grew from 37 percent to 40 percent and an average usage per data user increased from 16 MB to 22 MB per day within a week of network upgrade.
Baburajan K
editor@telecomlead.com
