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Reliance Industries to buy majority stake in Den Networks, Hathway Cable; reports increase in Q2 net profit

Jio added that it is aiming to connect 50 million homes with JioGigaFiber “in the shortest possible time”.

  • Published: October 17, 2018 9:59 PM IST
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Reliance Industries Limited (RIL) has announced an increase in its “consolidated net profit” for Q2 2018 by 17.4 percent at Rs 9516 crore. It reported that Reliance Jio customers base has crossed the 250 million mark. The company crossed this number “within 25 months” of launching Jio services. The announcement also revealed that the data consumption on Jio network reached 771 crore GB during the second quarter with each user consuming about 11GB per month.

The company claimed that the rate of date consumption was “growing rapidly” indicating that we may see an even larger amount of data consumption in coming quarters. It also revealed that Reliance Jio recorded Rs 618 crore in net profit during the quarter as the average revenue per user reached about Rs 131.7 per month with the total voice traffic amounting to 53,379 crore minutes which is 533,79,00,00,000 minutes or 10,149 centuries. The results also claimed that there is “strong demand” for its upcoming JioGigaFiber FTTH service “across 1,100 cities” in the early phase of registrations.

Chairman and Managing Director, Mukesh Ambani, issued a statement adding, “We are making rapid progress on the growth of our digital platforms, across new commerce, media and entertainment, agriculture, education, healthcare, and financial services, which will further enhance the quality of life and productivity of the people of India.” The company claimed that it is on its way to expand and improve its network coverage to cover 99 percent of the population of the country by the financial year of 2019 stating that its network is 5G ready.

Video leading the path

Talking about the consumption pattern of Reliance Jio users, the company added that video was the major driver of the bulk of data consumption.

The detailed results added that the video consumption of Jio users increased “by 410 crore hours per month” which amounts to an increase of about 17.5 hours of video consumption by each subscriber per month.

Majority stake in Den Networks, Hathway Cable and Datacom

Reliance announced a “strategic investment” in Den Networks, Hathway Cable, and Datacom, subject to regulatory approvals. This investment and partnership are to ensure that RIL can leverage the existing infrastructure of these companies to provide last mile connectivity to users across the country for its FTTH service. To simplify, this means that it will be easier for RIL to  use existing infrastructure in expanding its FTTH (Fiber To The Home) service, Reliance JioGigaFiber.

Diving into the details, the company will invest Rs 2,045 crore worth primary investment and Rs 245 secondary purchase to buy 66 percent stake in Den Networks, Rs 2,940 crore worth primary investment to buy 51.3% stake in Hathway Cable and Datacom Limited. The company claimed that it will be “a win-win” situation for the Local Cable Operators, internet consumers, the content providers, and the overall eco-system.

Impact of the strategic investment on internet landscape in India

RIL added that these investments will help Jio strengthen about 27,000 Local Cable Operators (LCOs) that work with Den Networks and Hathway. The company claims that this partnership will give LCOs, the “access to superior back-end infrastructure” along with the chance to team up with content providers, access to “latest business platforms” to increase “business efficiencies” and last but not the least, investment in digital infrastructure for the regular internet users. This likely hints at a strong push when it comes to new platforms and services including Smart Home, AR and VR experiences that Jio revealed earlier this year.

 

The company added that it has already started its work on connecting about 50 million homes across 1,100 cities across the country. RIL noted that it will also work with Hathway, Den and all the associated LCOs to provide “a quick and affordable upgrade” to JioGigaFiber and Jio Smart-Home Solutions” for the existing 24 million homes across 750 cities. Jio added that it is aiming to connect 50 million homes with JioGigaFiber “in the shortest possible time”.

The company added that it plans to bring features and services such as UHD (Ultra High Definition) entertainment, multi-party video conferencing, AI “in the form of voice-activated virtual assistants”, VR gaming and shopping, Smart Home solutions, and fixed mobile convergence to users.

Partnerships with Star India and Disney

Jio also announced a five-year partnership with Star India to broadcast all cricket matches played by the Indian team that is held in India on JioTV. This includes all the T20, ODI, International Test Matches, and even Premier BCCI domestic matches”. The company also teamed up with Disney to bring all its content on JioTV.

  • Published Date: October 17, 2018 9:59 PM IST