The telecom arm of Reliance Industries, Reliance Jio Infocomm Limited has planned to launch its 4G and broadband services by March 2016. The Mukesh Ambani-led company is now looking to associate itself with local cable operators to ensure connectivity in even the remotest areas.
Through its broadband business, Reliance Jio will offer Wi-Fi connectivity, television channels, video-on-demand, fixed telephony, and video services. To seamlessly offer these services, the company will have to establish fiber connectivity, widespread among a large number of households.
Strategy of Reliance Jio
At the company’s Annual General Meeting(AGM), Mukesh Ambani revealed that Reliance Jio has set up 2.5 lakh km of fiber-optic network. To enhance the connectivity and reach individual homes till the last mile, the company will partner or acquire cable operators especially in major and densely populated cities like Mumbai and Bangalore. The company may also take over a city-level multi-system operator (MSO). A subsidiary of Reliance Jio, Reliance Jio Media Pvt. Ltd. had received permission to roll out a pan-India MSO, this year in June.
Head of Strategy at Reliance Jio, Anshuman Thakur, said, “We have fiber on the ground, and now what we need is connectivity to homes. For this, we are partnering with local cable operators, multi-system operators, as they have the required infrastructure connecting the homes.”
He feels that local cable operators have a strong presence across households. Reliance Jio will associate itself with local operators in many ways. These include sharing profits, compensating operators for the homes they serve, acquiring them, or reimbursing their costs.
At the AGM, Ambani had said that Reliance Jio aims to cover more than 10 lakh homes with its fiber connections before April 2016. To achieve this goal, the company will boost its capabilities in 50 large cities of the country.
Views of experts
Experts feel that if any company wishes to start a broadband business, then it should have a strong network of cable operators. This will help the company to reduce costs and save a lot of time.
Sisir Pillai, Chief Operating Officer at Lukup Media Pvt. Ltd. said that there are around 1 lakh to 1.25 lakh cable operators in India. It took them several years to establish a fiber capacity of 20 km – 25 km. Any corporate would require a huge investment and time to set up such a model. According to Pillai, a company will have to resort to either partnership or acquisition in order to achieve this.
Lukup Media is an Internet Protocol television company that runs a system,which delivers television content on the Web. Prior to this, Pillai was Chief Strategy Officer at an MSO, Digicable Network India Pvt. Ltd.
Reliance Industries’ global ranking
In a more recent development, Reliance Industries has reacquired its prime position among Indian energy companies in the Platts global list. 14 Indian companies have been named in the list of top 250. Reliance Industries surpassed State-owned Oil and Natural Gas Corporation (ONGC), which was above it in 2014. Moreover, the company also improved its global ranking from 22, last year, to 14 this year.
Summary
To enhance its broadband connectivity, Reliance Jio is in talks with a number of local cable operators.