Reliance Jio has grown at a phenomenal pace, but it is already looking ahead at its next growth vertical. The Mukesh Ambani-led Reliance Industries is planning to invest another Rs 60,000 crore into its telecom unit this fiscal year. The investment will help Jio expand its broadband services, and wireless network. Reliance Jio might also borrow as much as Rs 1 trillion to further aid the expansion of its wireless network. “This is being done as Jio wants to fast-track its plan to scale up its capacity and coverage which would require further infusion of funds,” a source told Livemint.
Reliance Jio plans to continue to invest in laying fiber even as the firm has already built the largest optical fiber network in the country. Anshuman Thakur, head of strategy and planning at Jio, detailed the company’s plan to continue expanding its fiber network post earnings release last month.
“In terms of total investment, we don’t normally say such figures, but it is the largest network in the country, on both intra city as well as inter-city (fiber). We have a substantial advantage over all operators. But, we will keep on building fibre. We are gradually rolling out our FTTH (broadband services) and other services, during the course of which we will be laying much more fiber,” Thakur said.
Mint further reports that the fresh investments will also allow Jio to maintain the pricing pressure on incumbent players. Jio said it had an average revenue per user (ARPU) equivalent to Rs 137 during the earnings call last month. The growth in ARPU is mainly led by its Prime members subscribing to plan that has a higher validity, and lower interconnection charges.
Jio is expected to announce the commercial launch of its JioFiber fiber-to-the-home (FTTH) broadband service during the second half of this year. It has already begun offering 1.1TB FTTH broadband data in select markets. Apart from network expansion, Jio is also said to be investing in content acquisition as it tries to differentiate its service from its rivals.
Watch: Reliance JioPhone First Look Video
Jio’s broadband service was expected to become commercially available during Diwali last year. The new reports suggest JioFiber is in final stage of commercial launch, and the roll out will be gradual. Jio has disrupted India’s telecom market, but it is not immune to competition and it needs to be seen whether its fiber broadband gains as many subscribers as its wireless network.