Reliance Industries today said that that it had entered into an agreement to acquire a substantial stake in Infotel Broadband Services (P) Ltd, which has provisionally won a slot to offer broadband services in all the country's 22 service areas at a cost of Rs12,848 in the auction for broadband wireless access (BWA) Spectrum conducted by the DoT.
RIL will invest about Rs4,800 crore by subscribing to fresh equity capital at par, to be issued by Infotel Broadband, which will give RIL a 95-per cent of Infotel Broadband's equity.
After its acquisition, Infotel will become a subsidiary of Reliance.
RIL says it sees the broadband opportunity as a new frontier of knowledge economy in which it can take a leadership position and provide India with an opportunity to be in the forefront among the countries providing world-class 4G network and services.
A single 20 MHz TDD spectrum when used with LTE (long term evolution) has the potential of providing greater capacity when compared to existing communication infrastructure in the country.
The substantial growth of the mobile subscriber base over the last decade offers broadband providers a ready platform for offering various data services. Diverse data services and rich contents have significantly boosted data traffic in developed and other emerging markets.