The Mukesh Ambani-owned telecom operator is widely expected to unveil a spate of disruptive price plans in the Rs 500-700 per month range, offering a whopping 100 GB of data at starting speeds of 100 Mbps bundled with value-added services such as internet TV and video-calling, according to analysts.
Jio may even offer services for free for the initial 3-6 months, said a few analysts, mirroring its earlier wireless services pricing strategy for attracting home broadband customers who tend to be stickier than mobile phone users.
Other challenges for the telco, they said, could be the painstaking and costly process of creating physical infrastructure afresh on the ground in the fibrebased home broadband business, besides getting clearances from residents’ associations for extending home broadband last-mile connectivity to buildings.
Reliance Industries (RIL) chairman Mukesh Ambani on Thursday unveiled Jio’s high-speed home broadband services plans under the GigaFiber brand banner, to be rolled out across 1,100 cities, targeting 50 million homes. However, he did not specify a time frame for launch or the pricing.
“Jio will choose the initial cities for launch based on early demand levels for its home broadband services after the registration process kicks off from August 15, especially since there will be costs involved in extending lastmile connectivity,” said a senior industry executive, who did not wish to be identified.
Global brokerage Morgan Stanley said Jio would prioritise its home broadband services rollout to the localities which have the highest number of registrations. Brokerage JP Morgan said it expected Jio’s home broadband services “launch pricing to be at a large discount to current broadband and set-top box prices,” in line with its aggressive customer acquisition strategy.
Bharti Airtel currently offers 50 GB of data a month at speeds of 40 Mbps in Bengaluru for Rs 799 per month, whereas in Delhi a Rs 499 per month pack offers 100 GB a month at a much slower speeds of 8 Mbps. Rajiv Sharma, telecom analyst at HSBC, said he expected Bharti Airtel to “face near-term earnings pressure if Jio comes up with disruptive home broadband plans offering 100 GBs (of high-speed data) priced below Rs 700 per month”.
ET’s queries to Reliance Jio Infocomm did not elicit any response till late evening on Friday. Airtel is said to have already made a counter move, removing the FUP (fair usage policy) data limit on its home broadband packs in Hyderabad and turned them into unlimited data plans. A person familiar with the matter said that the telco could replicate the exercise in other key markets in the coming weeks. Bharti Airtel did not reply to ET’s queries on the matter.
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