Indian operators Bharti Airtel and Reliance Jio Infocomm have announced a network-sharing plan aimed at avoiding “duplication of infrastructure” and lowering costs.
The companies said they would share inter- and intra-city fiber-optic networks, submarine cable networks, towers, internet broadband services and other technologies that might emerge in future.
Besides avoiding duplication and freeing up capital for other projects, the operators said that comprehensive network sharing would help to “preserve the environment”.
In future, they noted, the arrangement could be extended to include roaming on 2G, 3G and 4G networks, with pricing at “arm’s length” and based on prevailing market rates.
India’s regulators, however, may take a dim view of plans for 3G roaming, having previously declared that such arrangements are in breach of licensing conditions.
Nevertheless, the tie-up could prove to be mutually beneficial given the respective positions of each player.
Controlled by Indian billionaire Mukesh Ambani, Reliance Jio Infocomm (Mumbai, India) is the only operator in India licensed to provide 4G services across the entire country, while Bharti’s (New Delhi, India) infrastructure business manages more than 35,000 towers across India besides an extensive fiber network.
The deal follows an earlier agreement under which Bharti Airtel agreed to provide capacity on its i2i submarine cable to Reliance Jio Infocomm.
Reliance Jio Infocomm has also formed a network-sharing partnership with Reliance Communications (Mumbai, India), the operator owned by Mukesh Ambani’s brother Anil.
The two brothers have had a frosty relationship since the Ambani business empire was split between them in 2005, and the network-sharing pact appeared to signify a thawing of their animosity.
Network-sharing agreements are becoming increasingly popular in India and other parts of the world, with operators looking to protect their margins amid a decline in their traditional business activities.
India’s operators have also outsourced the management and operation of infrastructure to network vendors like Ericsson as a means of improving efficiency.