RJio Snaps Up Broadband Assets in Spending Spree
India's Reliance Jio (RJio) has recently been on a shopping spree, spending $710 million on majority stakes in DEN Networks Ltd and Hathway Cable and Datacom.
That investment should help the Indian operator to speed up its rollout of a home broadband service called JioGigaFiber to around 50 million homes across 1,100 cities. The deals, it is hoped, will provide last-mile connectivity for JioGigaFiber, which had faced resistance from local cable operators when trying to address this problem.
Reliance Jio wants to carry its mobile market success into the home broadband arena. It managed to acquire 100 million mobile customers in just six months after offering free data broadband services to customers for the first six months.
"After having taken India to the top position in the mobile broadband space, Reliance is now committed to take India from a global rank of 135 to among the top three countries in the world on wireline digital connectivity," says the press release issued by the company.
RJio will leverage the network of 27,000 local cable operators (LCOs) associated with DEN and Hathway. That seems like a win-win situation for RJio and the LCOs. While RJio will be able to expand its reach and resolve its rights-of-way problems, the LCOs will have an ally to help them battle market competition from direct-to-home players. RJio can also help the LCOs upgrade their systems to provide newer services.
"With LCOs now part of the Jio ecosystem, we look forward to bringing RJio's advanced JioGigaFiber and smart home solutions to more Indian homes, even quicker," said Mukesh Ambani, the chairman of RJio parent company Reliance Industries, in a statement. "We look forward to welcoming other MSOs [multi-service operators] and LCOs to be part of this partnership. This will result in growing wireline data connectivity in India and making state-of-the-art high-speed affordable Internet and digital services accessible to the widest population in the shortest possible time."
The Skytran investment
These are not the only investments made by RJio. The company has also acquired a 12.7% in the US-based SkyTran, which develops technology for rapid transit systems. This investment is for an exclusive partnership in India to develop and build an Indian network at scale. Google Chairman Eric Schmidt and the US Department of Transportation have also invested in SkyTran.
"Our partnership with SkyTran reflects our commitment to invest in futuristic technologies. Reliance is well-poised to capitalize on its existing business portfolio and capabilities to accelerate the development of SkyTran across the world and especially in India," said Akash Ambani, a director at RJio.
RJio clearly wants to position itself as an innovator and a company that brings the latest technologies to India. The SkyTran tie-up will help it to develop a rapid transport system to avoid traffic congestion, which is a major problem in Indian metros. RJio has already transformed India's mobile market. The broadband and transportation sectors appears to be its next targets.
— Gagandeep Kaur, contributing editor, special to Light Reading