Company launches offers with attractive tariffs & speeds; not enough to disrupt market, say analysts
Three years after launching its mobile services which disrupted the telecom industry with its below-cost tariffs, Reliance Jio on Thursday launched its fibre-to-the-home (FTTH), wired broadband services across 1,600 cities in the country. But unlike its mobile services, analysts do not see the tariffs here as a major disruptor.
As it is, the wired broadband market isn’t big enough as it has a total base of just 18.45 million, of which the largest share is of BSNL’s at 9.09 million followed by Bharti Airtel which has 2.39 million subscribers. The other players are very small.
While Jio’s tariffs are certainly lower than that of Bharti’s and it offers speeds much higher than that offered by the latter, changing wired broadband connections is not as simple and easy as a mobile connection. A wired broadband connection requires fibre or copper to reach till the consumers’ home and putting this across is a tedious and time-consuming task. To put it simply, unlike a mobile connection, a consumer cannot tomorrow opt for a Jio broadband connection. Instead, upon a consumer evincing interest, it is Jio which would see whether its fibre reaches that particular area or not and if not it would have to assess how much time it would need to wire up that area.
Jio’s monthly tariffs start from `699 and go up to `8,499 with speed limits ranging between 100 Mbps and 1 Gbps. In comparison, Bharti’s tariffs start from `799 per month and go up to `1,999 with speed limits ranging around 40-300 Mbps. While Jio is offering a range of other attractions such as entertainment, even Bharti has recently upped its package with the launch of a platform called Airtel Xstream, which is a unified entertainment services platform.
According to brokerage BNP Paribas, Airtel’s Xstream platform can effectively counter Jio’s offerings.
“We believe Airtel’s current converged digital entertainment platform, Xstream is competitive on the pricing and product fronts and to a large extent tackles competition from JioFiber,” BNP Paribas said.
Further, the edge Bharti currently has is that it is providing free subscription of popular OTT players such as Amazon Prime and Netflix, whereas Jio does not have these at present.
RJio, which has received over 15 million registrations from nearly 1,600 towns, has announced a target to reach 20 million residences and 15 million business establishments in 1,600 towns over the next 12 months. On this count, its plans are ambitious as Bharti has presence in only 99 cities and that, too, in limited areas.
However, the launch of Reliance Jio’s wired broadband services will fire up this space which has not seen much competition till date and consumers can expect a bouquet of entertainment offerings at competitive rates as Jio expands its services.
Speaking on JioFiber, Akash Ambani, director, Reliance Jio Infocomm, said, “The launch of JioFiber, with its revolutionary services is just the beginning of a new and exciting journey. As always, we will continue working hard to bring more such amazing services to your home and take Jio Fiber to the next level”.