Reliance announces 50 percent cut in 3G prices

Reliance announces 50 percent cut in 3G prices

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Indian telecom giant Reliance has announced a price cut of its 3G rates, which can now be comparable to 2G prices. The recent announcement by the company means that 2G users can move to 3G by default, if the user’s handset supports it. The rates of 3G have been cut by almost 50 percent. The new 3G prices will be closer to 2G rates for both post-paid and pre-paid users.

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With this recent cut, the company hopes to capture 40 percent of smartphone and tablet user database. The new packs available from Reliance Communications are priced at Rs. 123 for 1 GB, Rs. 246 for 2 GB and Rs. 492 for 4 GB. Moreover, the latest offer will also be available for new subscribers who have entered the Reliance network through MNP.

The telecom giant also reduced the pay per use 3G data charges to just 1 paisa per 10 KB, which is half of what the rival operators offer. With these recent changes, it is very likely that this will lead to a full-fledged price war. Himanshu Shah, research analyst at HDFC Securities said, “We don’t foresee RCom’s rate reduction to have material impact on other telcos due to poor perception of brand and service of RCom and also because of its inferior 3G network presence.?

Shah also said that rival companies are unlikely to follow reduced rates.