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After telecom, Jio to bite into broadband and TV

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MUMBAI: After disrupting the telecom sector, Muskesh Ambani led Reliance Jio is now heading towards the fixed broadband and television space.

The company will launch high speed fibre to the home (FTTH) broadband in more than 30 cities early next year, to offer TV as well as internet to subscribers, it is learnt.

As reported by Business Standard, Jio has mapped out a plan to address over 100 million TV households across these cities, including tier II and III, by ensuring dense fibre presence for last-mile connectivity to homes. In the first phase itself, at least 50 million households will be offered the service, according to sources in the know.

Jio has already spread out over 300,000 kilometres of optic fibre (half of which is through a long-term contract with Anil Ambani’s Reliance Communications).

In his annual speech, Reliance Industries chairman Mukesh Ambani indicated that Jio was on track to offer high-speed broadband services. The infrastructure was in place and it would be the next big monetisation opportunity for the company, he had said.

According to the news report, Jio is expected to woo customers with premium offers such as ultra-high speed of up to 1 gigabit per second. The set-top box, as part of the package, will be a home entertainment hub – offering TV channels, high-end gaming and video on demand, among others.

Jio is eyeing an average revenue per user of around Rs 1000 to Rs 1500 per month from subscribers (which includes internet and TV), as their usage of data goes up, a source said.

Trials are being conducted in Mumbai and Delhi with only internet services at speeds of 100 megabits per second and 100 gigabytes of data free of cost. It is providing a special router, which connects multiple devices at a refundable deposit of Rs 4500. With a multi-service operator (MSO) licence in place, it will also offer TV services.

Representatives of conventional TV industry cite numbers to back their claim that this is a tough game. While there are 180 million TV households in the country, subscribers fork out an average of only Rs 300- 400 a month for as many as 400 to 500 channels currently, they say.

Competitors also say that currently, only three million subscribers cough up over Rs 1000 for high-speed broadband internet and only two million rustle up a similar amount per month for DTH or cable. So, the market that Jio is looking to address is currently niche and a small one.

“Deploying FTTH is an expensive business and obviously Jio is making large investments. So, they have to get an adequate return on their investments. They might offer free broadband like they are doing currently and as they did earlier in the mobile space,” said a top industry executive to BS. But they will have to increase tariffs to make money and that might not translate into mass adoption.

If the experiment succeeds, the number of households with TV and broadband, currently growing very slowly, could just explode, he said.

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