Subject category:
Strategy and General Management
Published by:
Stanford Business School
Version: 9 August 2005
Length: 22 pages
Data source: Field research
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Abstract
Mukesh Ambani, the Chief Executive Officer of India''s largest business house, Reliance Industries Ltd (RIL), was contemplating a major decision that could significantly affect the future of his company as well as the telecommunications landscape in India. By 2002, GSM (global system for mobile) cellular roaming services, based on TDMA (time division multiple access) technology, had become the de facto standard in India. Seeking to find an alternative to GSM, Ambani''s telecom team had developed an innovative solution for providing inexpensive roaming cellular services to customers on a nationwide basis using CDMA (code division multiple access) technology. The required infrastructure for CDMA, which was significantly less costly than that of GSM, was already in place. As an early mover with a competitively priced CDMA offering, Ambani was confident he could capture a large percentage of the market. Reliance had permission from the Indian government to provide local CDMA coverage, yet there was nothing in the law that explicitly prohibited the company from rolling out these services on a more widespread basis to subscribers across the country.
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Abstract
Mukesh Ambani, the Chief Executive Officer of India''s largest business house, Reliance Industries Ltd (RIL), was contemplating a major decision that could significantly affect the future of his company as well as the telecommunications landscape in India. By 2002, GSM (global system for mobile) cellular roaming services, based on TDMA (time division multiple access) technology, had become the de facto standard in India. Seeking to find an alternative to GSM, Ambani''s telecom team had developed an innovative solution for providing inexpensive roaming cellular services to customers on a nationwide basis using CDMA (code division multiple access) technology. The required infrastructure for CDMA, which was significantly less costly than that of GSM, was already in place. As an early mover with a competitively priced CDMA offering, Ambani was confident he could capture a large percentage of the market. Reliance had permission from the Indian government to provide local CDMA coverage, yet there was nothing in the law that explicitly prohibited the company from rolling out these services on a more widespread basis to subscribers across the country.