Indian Telecom War: start up Reliance Takes on Leader Airtel in $4$G Services

Bharti Airtel limited being in the forefront in offering $2$G AND $3$G TELECOM SERVICES IN India and by enhancing its market share across the country, became the largest mobile phone operator in India by $2009-10.$ However, with intensifying competition and the resulting decline in Average Revenue Per User $($ARPU$),$ the company was looking for opportunities to further consolidate its leadership position. In $2010,$ Airtel won spectrum for Broadband Wireless Access $($BWA$)$ through an auction for four telecom circles, but it could not win in two important circles of Mumbai and Delhi. In $2012,$ it bought a $49\%$ stake in Wireless Business Services Pvt$.$ Ltd to gain access to wireless broadband spectrum in the two crucial circles in Delhi and Mumbai.

Reliance Industries Limited $($RIL$),$ the largest private company in India, had forayed into the Indian telecom industry in $2010.$ In the division of family businesses in $2005,$ RIL signed a non compete agreement with ADAG. As per the pact, RIL could not enter telecommunications. The two parties scraped the agreement in $2010,$ paving way for RIL to enter into the telecommunications industry. RIL bought a $95\%$ stake in Infotel Broadband Services $($Infotel$),$ which won spectrum in all the circles. RIL renamed Infotel as Reliance Jio Infocomm in January $2013$ and in July started work on rolling out $4$Gservices telecom services in eight states of Northeast India by April $2014.$

Subsequent to its acquisitions, Airtel became the first company to launch $4$G services in India in late $2012$ nd Early $2013.$ RIL$$s Reliance JioInfocomm followed hard on the heels of Airtel spicing up the competition between two giants.

QUESTIONS:

A$.$ Discuss the relevant strategies to be followed by the leader, Airtel and the challenger, RIL.

B$.$ Debate if RIL is in a position to negate the first mover$$s advantage of Airtel in offering $4$G services. Also deliberate the entry strategies of RIL.