JioFiber broadband takes entertainment route for next million users

India has 18.42 million wired or fixed broadband customers till June 2019. For comparison, India has 576.17 million mobile Internet customers.
Mukesh Ambani on Reliance Jio digital lifeIndia’s fixed broadband market did not grow due to lack of affordability, lack of Internet speed, lack of availability, lack of high-quality content and poor spending power among majority of Indians.

Mukesh Ambani, India’s richest person, will have the task of growing the demand for wired broadband connections across the country. Mukesh Ambani is taking the entertainment route to fix this issue.

Mukesh Ambani’s JioFiber broadband service, which will start on Thursday across India, will offer a free high-definition television and set-top boxes for subscribers who spend money for an annual lifetime offer. Reliance Jio will also offer subscriptions to watch premium video streaming services with prices starting from Rs 700 or nearly $10 per month.

JioFiber broadband may tie up with Netflix, and Walt Disney’s Hotstar to offer premium content like movies and entertainment shows via Internet.

Reliance Jio earlier disrupted the voice market by offering free voice services to all Indians on its 4G network. Jio bills customers for its mobile data plans only.

India’s video-on-demand market, according to Boston Consulting Group (BCG), will reach $5 billion by 2023 from $500 million last year. Paying subscribers for accessing video content will probably rise to 50 million. Users of advertising-supported video-on-demand will reach 600 million, BCG said.

JioFiber will include movies that can be seen by Internet subscribers on the same day they debut in cinemas, Mukesh Ambani said in a speech laying out the plan on Aug. 12. Reliance will launch movie premier second half of next year, he said.

Airtel has unveiled upgraded versions of its set-top box and the Airtel Xstream Stick, a USB device that allows an ordinary television to access OTT applications like Netflix, Amazon Prime Video and YouTube, along with Airtel’s other content offerings.

Airtel’s digital TV segment accounted for about 12 percent of earnings for the year ended March. Airtel is the #2 player in India’s fixed broadband market – behind BSNL. But Airtel is the #1 operator in the fiber broadband space.

Satellite providers such as Tata Sky and Dish TV India as well as cinema chains also face competition from Jio, which will offer fiber TV in bundles with its mobile services and free landline calling.

Mukesh Ambani wants to generate strong ARPU from broadband business. But addition of wired broadband subscribers is the big task for the three-year old Reliance Jio. The 4G operator added more than 300 million subscribers to its mobile network in three years. Indian telecom industry stakeholders believe that Reliance has the financial backing to win in the wired broadband market.