Reliance GSM services by March '07

Company ropes in JM Morgan Stanley for operations rejig .

Reliance Communications may launch its GSM services in Delhi and Mumbai by March-end. The move is expected to trigger off a tariff war as the company is planning to introduce competitive pricing strategies.

The Anil Ambani-promoted company has also roped in JM Morgan Stanley (JMMS) as financial advisor for a proposed re-organisation.

Even though the exact details for the reorganistaion were not available, sources speculate that this could be bringing all its telephony operations - internet, CDMA, GSM and submarine cable - under one umbrella.

"Telecom tariffs in the country have reached a plateau, with no new price points being discovered during the last six months. Reliance Communications is working towards introducing new price points that would result in bringing in the next phase of growth in the telecom sector," a source close to the development said today. When contacted, Reliance Communications officials declined to comment.

The company expects to be allocated the 1,800 MHz spectrum by the Department of Telecommunications (DoT) by October.

Apart from the two metros "� Mumbai and Delhi "� Reliance Communications is also looking to expand its GSM services to other parts of the country.

The company is planning to bundle instruments with services, thus lowering the price of handset. Also the absence of royalty charges in GSM, unlike in CDMA, will result in considerably lower handset prices.

According to analysts, lower prices could trigger off another tariff war in the sensitive telecom sector.

The industry has been a competitive one, with each player trying to outpace the other.