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Overly intense rivalry between Indian telcos could paralyse entire sector, warns Qualcomm chief Paul Jacobs

India's telecom industry has been roiled by a row over the launch of 4G services by Mukesh Ambani-led Reliance Jio Infocomm.

, ET Bureau|
Updated: Aug 30, 2016, 03.37 PM IST
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Jacobs, 53, leads a company which is known as the enabler of the wireless ecosystem.
Jacobs, 53, leads a company which is known as the enabler of the wireless ecosystem.
NEW DELHI: Qualcomm Executive Chairman Paul Jacobs said "overly intense" rivalry is not good for the telecom industry and can lead to “paralysis“ as compa nies get too caught up in fighting each other, spurning innovation and in vestment.' "It happens in other places, I think it can get pretty strong, it's natural,“ Jacobs told ET in an interview. But he said: “I don't think we have seen that point."

India's telecom industry has been roiled by a row over the launch of 4G services by Mukesh Ambani-led Reliance Jio Infocomm. Incumbents have accused the Telecom Regulatory Authority of India of favouring the newcomer, al legations that have been denied Jio has said the incumbents are denying it interconnect points The latter say the company has launched full-fledged services in the guise of tests. Jacobs said rivalry that's healthy spurs companies to outdo each other while creating technologies or business models that expand the market, citing the example of Qualcomm.

“The very early days where Qualcomm looked at Motorola and thought that's the company we are going to define ourselves against -in the end we became very good part ners,“ he said. “There are ebbs and flows in any kinds of relationships and that's true here as well. There are degrees of cooperation and competition and depends where in the cycle you are. We have seen that happen in Korea and China, and pretty much everywhere.“

Jacobs, 53, leads a company which is known as the enabler of the wireless ecosystem.

The executive also reckoned that interconnect usage charges could decline as data surpasses voice over aperiod of time and services start to bypass the carrier infrastructure.

Full interview: Designing top tech in India on agenda, says Paul Jacobs

CONSOLIDATION WILL HELP

Jacobs also said that ongoing consolidation will help telcos build scale and lower charges.

“In the operator business with a lot of capex and procurement of devices, scale is the benefit, but it is a balancing act,“ he said. “If it goes too far, then it is not good for us or anybody.“ While the increased availability of airwaves in India is positive, he sees reserve prices as the “fly in the ointment,“ adding, “We will be interested to see how that plays out with operators and how they bid.“

Qualcomm is also pitching its low earth orbit satellite system that the chip maker is building with partners like Virgin Group under the name of OneWeb to offer broadband services. “The whole idea behind it is to provide mobile broadband to places in the world where it is very hard to get broadband coverage, which aligns very much with his (PM Narendra Modi's) ideas behind connecting people and communities. And even the smart cities aspect,“ Jacobs said.

MEETING WITH MODI

Jacobs met Modi on Monday evening to discuss issues pertaining to the telecom industry and enhancing partnership for government initiatives like Digital India and Make in India. He also met Telecom Minister Manoj Sinha.

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