Reliance Jio ups the ante, invests Rs.70K crore in 4G venture

BANGALORE, INDIA: Reliance Industries has announced an investment of a whopping Rs. 70,000 crore to make a steller entry into the 4G telecom services market. The vision is to make Reliance Jio one of the large job-creating and wealth-creating business initiatives in India.

Addressing to the shareholders in Mumbai, RIL chairman Mukesh Ambani has given details on the planned rollout. The plan is to cover 5,000 towns and cities, and over 2,15,000 villages across all the states in India initially. Eventually, the network will encompass over 6,00,000 villages. Reliance will accomplish this task in a phased manner.

"Limited field trials with our initial set of services for the broad band services are already underway. Expanded field trials will commence in August this year across multiple cities. These trials would continue through the end of 2014 and early part of 2015," said he.

The initiative will widen the prospects of the digital business further. Besides contributing to the country's GDP growth, the digital services will help to create more jobs.

Reliance Jio has already 10,000 full time employees to make this vision work, and also working closely with nearly 30,000 professionals from among its partners outside. Over 1,00,000 people are also working across the country to create the digital infrastructure backbone for this network.

The announcement brings some relief for the rivals such as Bharti Airtel, Vodafone India and Idea Cellular, who are likely to be dragged back to the days of price war, once Mukesh Ambani-owned Reliance Jio Infocomm starts rolling out its 4G voice and data services. Last week, Credit Suisse downgraded Bharti Airtel's stock to underperform, and kept Idea Cellular and Reliance Communications at underperform, citing competitive fears.

Reliance Jio will leverage the increasing criticality of data-driven applications for individuals, governments, businesses and enterprises to boost its services play. The acquisition of Network 18 Media and its subsidiary TV18 Broadcast is one aspect of the digital services play, which will differentiate and strengthen its 4G business.