Mukesh Ambani plans telecom re-entry - ft.com
Billionaire industrialist Mukesh Ambani's Reliance Industries is preparing to bid in India's forthcoming mobile auctions, with potentially far-reaching consequences for the country's battered USD 32 billion telecoms market, according to people familiar with the group.
The move would intensify competition in an already cut-throat sector and set India's richest man on a long-term collision course with the country's two leading mobile operators, Bharti Airtel and Vodafone.
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Close observers of the elder Mr Ambani say his auction plans carries wider significance, with roots in the break-up of the
business empire which his late father Dhirubhai Ambani built from scratch to become India's largest listed company.
"Telecoms has always been Mukesh's baby, it was tough for him to give it up," says one senior Indian business figure, who did not want to be named. "And if they get in they will want to be the dominant player ... In the long term they don't get into businesses where they don't dominate."
Those familiar with Mr Ambani's thinking say his auction preparations are part of plans to augment his 4G proposals with a more traditional "voice" product, a strategy analysts say is more likely to succeed than a data-only offering.
"Reliance will make a big bang entry when they come out with 4G," says one senior telecoms analyst, who did not want to be named. "If they enter the auctions it will sound very clear warning bells to their competitors that change is afoot, because the landscape becomes much, much more competitive in the long term."
