Reliance Infocomm wooing cable operators to push fixed telephony & broadband

MUMBAI: For Anil Ambani, it has been the hardest part of the game. The last mile, crucial for offering triple play services, has so far been elusive.

Now, Ambani has come out with a concrete offer to cable operators. His aim is to push fixed telephony and broadband services with their assistance.

Reliance Infocomm is offering cable operators a 10 per cent margin on gross revenues from data and voice services, sources say. The billing will be handled by Reliance. The telecom company has also promised to invest in the infrastructure, which will include digital loop carriers (DLC), home switches, and Cat 5 cable.

DLC, which is a junction box through which Reliance will push Cat 5 cable, will be installed for every 200 customers of telephony and around 42 customers of broadband Internet. Reliance Infocomm will put in the entire investments.

There is a catch, though. Cable operators will have to put in Rs 100,000 as security deposit for each DLC. And they will not be given any interest on these deposits. "We are making all the investments. We just need a commitment from cable operators," a source in the company said.

Cable operators, however, are not fully convinced. "Why should we set aside Rs 100,000 for every DLC? We are, after all, going to bring them the customers. Besides, we offer cable Internet on our own," a last mile operator said.

Cable operators also fear that Reliance will be competing with them as it plans to launch direct-to-home (DTH) television and video services.

Still, for his latest initiative, Ambani has carefully kept video services out of the game so far. He does not want the cable operators to feel that he is entering their turf and could snatch their business away.

Ambani's sales pitch: cable operators can build in an additional revenue stream. "Cable operators can make money from telephony and broadband in addition to their offering of cable TV services," says the source.

The big question is: will cable operators bite the bait?

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