Reliance Jio may expand testing as row with telecom lobby reaches PMO

Reliance Jio plans to offer five to 500 connections free of cost for a limited time to employees of select companies


The COAI alleges that Reliance Jio’s ongoing test involving 1.5 million people is actually a commercial operation. Photo: Abhijit Bhatlekar/Mint
The COAI alleges that Reliance Jio’s ongoing test involving 1.5 million people is actually a commercial operation. Photo: Abhijit Bhatlekar/Mint

Mumbai: Even as the Cellular Operators Association of India (COAI) escalated its fight with the Telecom Regulatory Authority of India (Trai) and Reliance Jio Infocomm Ltd to the Prime Minister’s Office (PMO), it emerges that R-Jio is set to expand the scope of the ongoing test-phase of its launch by tapping corporate customers.

The plan is to offer between five and 500 connections free of cost for a limited time to employees of select companies, two Jio officials, who asked not to be named, said.

A spokesman for Reliance Jio, a unit of Reliance Industries Ltd, did not respond to an email seeking comment.

According to the Reliance Jio officials, the company needs to expand its customer base to test its network. Its ongoing test, involving 1.5 million customers, has already run afoul of COAI, primarily a lobby of large incumbent telcos (although Reliance is also part of it), which says a test of this magnitude is actually a commercial operation.

COAI has also complained to the department of telecommunications that this launch has been done without submission of a tariff plan or interconnection agreements. It claims that as a result, telcos on whose networks calls made from Reliance Jio networks terminate, do not receive the so-called interconnection usage charge (IUC). COAI has also alleged that proposals by Trai on a new interconnect regime that slashes IUCs or moving to a so-called bill-and-keep model that favours new telcos are favourable to Reliance Jio.

On Thursday, the lobby group took its fight to the PMO.

Reliance Jio said on Wednesday that COAI’s moves are an effort to sabotage its launch.

The newcomer wants to reach a subscriber base of 22 million before it launches commercially. The move to look at companies is a logical one, said a consultant.

“It’s a natural progression from pre-paid to post-paid and with large data users being post-paid customers, it (the corporate segment) is a very attractive and competitive segment for a company to be in,” said Kunal Bajaj, consultant for telecom ventures.

Till the first quarter of this fiscal, Reliance Industries has spent Rs.1.34 trillion on Jio, funded by a combination of equity (Rs.45,000 crore), debt (Rs.47,000 crore), vendor financing (Rs.28,000 crore), and deferred spectrum payments (Rs.14,000 crore). This spending has helped Reliance Jio cover 70% of India with 270,000km of fibre optic cables and 92,000 towers. The company has said it will spend another Rs.15,000 crore.

Upasana Jain contributed to this story.

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