RCom to shut down its 2G mobile business in about a month

Debt-ridden Reliance Communications plans to shut down its 2G mobile business by November 30 while continuing to operate 3G and 4G services till the time they remain profitable, industry sources said.

RCom Executive Director Gurdeep Singh is learnt to have informed employees that the company has reached a "situation where we need to call it a day on our wireless business" and this would lead to closure of "wireless business 30 days from now". Singh is also learnt to have mentioned closure of company's DTH business once its licence expires on November 21.

The company will "continue to operate ILD voice, consumer voice and 4G dongle post-paid services" and mobile tower business till the time they remain profitable and all the other business will be shut down, he has said.

". . .RCom has decided to adopt a 4G-focussed strategy for profitable growth of its wireless business. Accordingly, RCom will be optimizing its 2G and 3G footprint, and related infrastructure and human resources, with effect from 30 November 2017. The company’s 4G-led strategy will be executed, as at present, on the back of capital-light access to India’s most extensive 4G mobile network, through already operational spectrum-sharing and ICR arrangements with Reliance Jio," Reliance Communications' spokesperson wrote in a press statement.

According to data posted on the telecom regulator’s website, as on July 31, Reliance Communications had 81.27 wireless consumers, 12.75 million mobile broadband service subscribers and 1.16 million wireline consumers.

The move comes after the company, reeling under debt of around Rs 46,000 crore, failed to close to its wireless business merger deal with Aircel in the beginning of this month.

RCom and Aircel in September last year had signed a binding agreement to merge their mobile businesses. But on Sunday, RCom announced the agreement had lapsed owing to legal and regulatory uncertainties, objections by interested parties and delays in receiving relevant approvals.

While Aircel was one of the several possible transactions that Ambani was pushing for to reduce RCom's debt, the company said on Sunday it would consider an alternate plan to cut debt, which includes sharing and trading of its spectrum or airwaves valued at about Rs 19,000 crore.