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Reliance Jio is piggybacking on the infrastructure of local cable operators to meet the JioGigaFiber launch target. Photo: Reuters
Reliance Jio is piggybacking on the infrastructure of local cable operators to meet the JioGigaFiber launch target. Photo: Reuters

Reliance JioGigaFiber launch process interrupted by rains

The process of laying fibre for Reliance JioGigaFiber has been stopped due to unfavourable weather as the government does not give permission to dig during rains

New Delhi/Mumbai: Reliance Jio Infocomm Ltd’s fibre-to-the-home (FTTH) broadband service is looking to overcome the challenges of deploying fibre in the last mile by piggybacking on the infrastructure of local cable operators to meet the JioGigaFiber service’s launch later this year. “The process of laying fibre outside has been stopped due to unfavourable weather as the government does not give permission to dig during rains," a person aware of the development said on condition of anonymity.

The launch of JioGigaFiber will come bundled with content, set-top box and VoIP (voice over internet protocol) phone and could potentially disrupt the wired broadband market in the same way as it disrupted the wireless market.

Reliance Industries Ltd (RIL) chairman Mukesh Ambani said at the company’s 41st annual general meeting (AGM) on 5 July that registration for JioGigaFiber would start from 15 August. Rollout would be prioritized across localities with the highest number of registrations, he said. While the company did not officially announce a date for the commercial launch, it is likely to be by the end of this year, Mint reported on 16 April.

JioGigaFiber will be the largest greenfield fixed-line broadband roll-out globally, with simultaneous introduction in 1,100 cities across India, Ambani had said.

“It does not look like the company will be able to go for a mass-scale launch," the person said. “Rights of way is a huge problem at municipality level. To overcome this, Reliance Jio has appointed one liaisoning officer for every state to ensure the roll-out is not delayed."

At the shareholders’ meeting, Ambani said JioGigaFiber would build a home-and-office connectivity platform connecting potentially 50 million homes.

However, analysts said it may be challenging for Reliance Industries to meet its 50-million-user target due to last-mile connectivity issues.

“The management has admitted that the target of 50 million users on FTTH will be challenging due to issues of last-mile connectivity. However, it is open to tying up with local cable operators to accelerate the penetration," said Saurabh Handa and Gaurav Malhotra of Citi Research in their report dated 29 July. The last-mile capex (from kerb to home and set-top box) will be $100-$150 per subscriber, all of which may not be incurred by the firm, Handa and Malhotra said.

The capex per subscriber seems high, which will materially alter the payback period for Reliance Jio, Amit Shah, an analyst with BNP Paribas, wrote in a 30 July report.

Meanwhile, rival Bharti Airtel Ltd is also trying to push its home broadband offerings in new cities and expand network coverage in key markets such as Delhi, Bengaluru, Mumbai, Kolkata and Chennai ahead of the entry of Reliance Jio.

Airtel has also boosted its content by introducing a new home broadband plan with speeds of up to 300 mbps at a monthly rental of 2,199, with 1,200 GB of data and free subscription to Airtel apps Wynk Music and Airtel TV. As part of the wired broadband trials, Reliance Jio is currently offering unlimited internet at 100 mbps, against a security deposit of 4,500 in New Delhi and Mumbai.

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