Mukesh Ambani-led Reliance Jio Infocomm and Sunil Mittal-headed Bharti Airtel on Tuesday announced a comprehensive arrangement for sharing telecom infrastructure, a partnership that will help them reduce costs they incur on their respective networks.
"This (arrangement) will include optic fibre network -- inter and intra city, submarine cable networks, towers and internet broadband services and other such opportunities identified in the future," a joint statement by the two companies said.
On Monday, Ambani had said the Reliance group was open to join hands with Bharti Airtel for improving telecom network for 4G services in Punjab.
The joint statement said: "The arrangement could, in future, be extended to roaming on 2G, 3G and 4G, and any other mutually benefiting areas relating to telecommunication, including but not limited to jointly laying optic fibre or other forms of infrastructure services."
Reliance Jio Infocomm is the only company which has pan-India airwaves that can be used for 4G services very high speed wireless broadband services), while Bharti Airtel is already the largest teleocm operator in the country with a subscriber base of over 19 crore (Rs 190 million).
Airtel offer all kinds telecom services, include 4G
The statement said ‘the pricing would be at 'arm's length', based on the prevailing market rates’.
The arrangement will also provide redundancy in order to ensure seamless services to customers of the respective parties.
The co-operation is aimed at avoiding duplication of infrastructure, wherever possible, and to preserve capital and environment.
Bharti and Reliance Jio are already in an agreement under which Bharti had provided capacity on its i2i submarine cable to Reliance Jio.
Last week, Minister of State for Communication and IT Milind Deora sharing a dais with Prime Minister Manmohan Singh appealed to the telecom industry to sort out differences among them for development of the sector.
In April this year, Reliance Jio had signed a similar agreement Anil Ambani-led Reliance Communications for sharing their existing and future telecom infrastructure.
This deal was the first business deal between the two brothers since they split the Ambani empire in 2005.
Soon, they followed it by another agreement in June on mobile tower sharing.