Reliance Jio GigaFibre built on tripod of acquisition/franchisee route, tier 2/3 cities and free service

Pravin Prashant 
Reliance Jio has achieved 250 million broadband subscribers in the last 25 months and is now looking at FTTH or GigaFibre business in big way in 2019. The company is looking at consolidating cable TV business either by acquiring large operators or making them franchisee for selling broadband and broadcast services simultaneously by using existing cable operators network and its own fiber network to enter inside residential complexes. 
 
The company is looking at three pronged strategy – Acquisition/franchisee route for acquiring customers through cable operators, initially focusing on tier 2/3 cities and offering free service during preview offer similar to what was offered during Jio broadband services. 
Acquisition/Franchisee Route: Reliance Jio is looking both at acquisition and franchisee route for offering GigaFibre services in cities and towns across pan-India. The company has made a primary investment of Rs. 2,045 crore through a preferential issue and secondary purchase of Rs. 245 crore from the existing promoters for a 66% stake in Den Networks and the company has also made a primary investment of Rs. 2,940 crore through a preferential issue for a 51.3% stake in Hathway Cable and Datacom. Reliance Jio would also make open open offers for both the companies. The industry will see more such acquisitions of big and small cable operators in future so that Reliance Jio can have maximum share of FTTH services in 2-3 years time.
 
The company is also in talks with cable operators big and small for making them franchisee for Jio GigaFibre. This will give Jio inroads to residential complexes and they can spread their services very fast.
 
Focus on Tier 2 and Tier 3 cities: According to a report carried in TotalTele, Reliance Jio has revealed that the first cities/towns to receive GigaFiber services will be Bangalore, Chennai, Ranchi, Pune, Indore, Thane, Bhopal, Lucknow, Kanpur, Patna, Allahabad, Raipur, Nagpur, Ghaziabad, Ludhiana, Madurai, Nashik, Faridabad, Coimbatore, Guwahati, Agra, Meerut, Rajkot, Srinagar, Amritsar, Chandigarh, Jodhpur, Kota and Solapur. Though the company is proposing to deliver gigabit capable broadband speeds through FTTH in 1,100 cities and towns pan-India.
 
As per the reports, Reliance Jio is focusing on Tier 2 and Tier 3 cities and not metro cities like Delhi, Mumbai, Chennai and Kolkata. Once the consolidation and acceptability increases for Reliance Jio in Tier 2 and Tier 3 cities for FTTH, the company will look at metro cities in the second phase.
 
Free Service: JioGigaFiber preview offer provides consumer ultra high-speed Internet up to 100 Mbps for 90 days along with a monthly data quota of 100 GB and a complimentary access to a host of Jio’s premium apps. As per preview offer, there are no installation charges levied but there is a refundable security deposit of Rs. 4,500 taken for the ONT device (GigaHub Home Gateway). Initially, Reliance Jio is not charging for any service.
 
Reliance Jio is planing to reach 50 million homes and 10 million businesses and so the company is looking at multiple approaches to market Jio GigaFibre.