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Cable ops need to fear as RIL readies Jio launch in 2015 with Rs 70,000 cr investment plan

MUMBAI: Cable TV and direct-to-home (DTH) operators will face new competition as Reliance Jio readies to launch 4G services next year with a mammoth investment plan of Rs 70,000 crore (Rs 700 billion) in the business.

Rolling out in phases across India from 2015, the high-speed data as well as voice services will have entertainment as a big part of its strategic offering. Subscribers will get on offer television channels, video-on-demand service and a facility to automatically store TV shows for a specific number of days on cloud.

The acquisition of Network18 and TV18 only emphasizes the importance video content will play in driving data traffic. This will be one important aspect of Reliance Jio’s digital services play. The grab will be to get into the consumer homes and make a total offering at a lucrative price that will cover broadband, communication, information and television channels.

Speaking about the acquisition of Network18 , Reliance Industries Ltd chairman Mukesh Ambani said: “This will differentiate and strengthen our 4G business at the unique intersects of telecom, web and digital commerce, and the media through a suite of premier digital properties.” He was speaking at RIL’s 40th AGM.

Mukesh_AmbaniRIL’s play in the television business includes TV18 entertainment and news channels like Colors, MTV, Vh1, Nick, Comedy Central, CNN IBN, IBN 7, CNBC TV18, Awaaz and IBN Lokmat. The ETV channels are also under the company’s belt. Reliance Jio is also stitching content deals with other broadcasters.

Ambani also has a presence in the sports business through its IPL franchise Mumbai Indians and a JV with IMG. He is absent in sports broadcasting but that could be part of the agenda.

According to the RIL annual report, Jio will stretch across “various digital domains of national interest such as education, healthcare, security, financial services, government citizen interfaces and entertainment”.

The scale of operations is unprecedented in the annals of Indian business as a fibre optic network is being built across the country. Among other technologies, Jio will use fibre to the location and has already activated WiFi in several pockets of the country.

There are over 10,000 full-time Jio employees working alongside nearly 30,000 professionals from partners and vendors from across the globe.

“In addition, there are over 100,000 people working across the country in creating the digital infrastructure backbone for this network. They are passionate about building the largest broadband network that the world has ever seen. Reliance Jio will be one of the largest job-creating and wealth-creating business initiatives in India,” Ambani said.

As per the plan, the network and broadband services will be ubiquitous—initially covering all states, all the 5,000 towns and cities accounting for over 90 per cent of urban India and over 215,000 villages in India. Eventually, the network will encompass each of over 600,000 villages in the country.

The company plans to commence expanded field trials in August across multiple cities. “These trials would continue through the end  of 2014 and early part of 2015. The objective is to ensure that everything that we offer is future-proof and world-class,” Ambani said.

He further added that the year 2015 will see the phased launch of Reliance Jio across India. “Millions of customers would have started to use the digital platform and services in their daily lives. The fruits of the tremendous value created by this Rs 70,000 crore initiative would start to flow. This value creation would be on a base of 1.25 billion Indians, with an opportunity to include all sections of our society in the exciting promise of the digital economy,” he said.

Addressing the shareholders at the RIL AGM, Ambani said RIL’s vision and goals for Reliance Jio are ‘overarching’. “Besides providing the base broadband connectivity to all citizens, the digital infrastructure and digital services have the potential to add significantly to India’s GDP growth. Millions of new entrepreneurs and jobs can be expected to spring up in secondary and tertiary sectors in new and innovative digital enterprises and services.”

He added that his aim is to make every piece of critical information available to all citizens at the touch of a button. “Reliance Jio is the future that Reliance is building for the generations to follow. They deserve to be on a par with the best in the world—whether in education or health care or security for their families,” Ambani said.

Reliance Jio will leverage on the emerging data explosion concurrent with the large volume and criticality of data traffic and data-driven applications for individuals, governments, businesses and enterprises of all hues, in urban and rural areas.

Cable operators, beware. Mukesh Ambani is coming and, as he says, Reliance Jio “will be RIL’s most transformative business”.

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