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Hathway’s Q3 broadband subscriber adds hit by demonetisation and Reliance Jio

MUMBAI:  Demonetisation of high-value currency notes and the explosive growth of Reliance Jio slowed down Hathway Cable & Datacom’s broadband subscriber growth in the fiscal third quarter.

Hathway lost the opportunity to add around 10,000 net subscribers in November, according to the company’s own estimates.

Another 10–15% impact was felt due to competitive intensity. Typically, around 15% of Hathway’s new broadband consumers are marginal users who consume less than 20GB a month. These are the consumers who could have been drawn to Reliance Jio’s 4G service, which is free until 31 March.

Hathway believes that the wired broadband users who consume 40GB upwards are intact. These subscribers use high-bandwidth applications.

Hathway added 40,000 subscribers in the quarter ended 31 December to take the standalone broadband figure to 0.6 million. In the preceding quarter, the multi-system operator (MSO) had added around 70,000 subscribers at the standalone level. The total subscriber base at the consolidated level stands at 0.86 million.

Hathway is confident of going back to adding 25,000 broadband subscribers per month. The company is launching its broadband service in some new markets. Also, the GPON fibre-to-home network in Chennai, launched on 1 February, is expected to have four lakh homes passed by the end of March.

Hathway has already rolled out GPON fibre-to-home networks in Bangalore, Kolkata and Delhi. Currently, GPON consumers are offered 50 Mbps, 100 Mbps and 150 Mbps packages, and the network is being designed to have capacity for offering speeds as high as 1 Gbps.

Churn continues at 1.8%, out of which 1% is due to people shifting their homes and thus moving out of the MSO’s homes-passed coverage area.

Hathway’s broadband revenue has stayed ahead of its cable TV subscription income for two consecutive quarters. Broadband revenue for the quarter ended 31 December 2016 stood at Rs 127.8 crore. In comparison, cable TV subscription revenue stood at Rs 114.1 crore. In the first quarter ended 30 September, broadband revenue was at Rs 120.3 crore. In contrast, cable TV subscription revenue stood at Rs 110.4 crore.