Reliance Jio to Launch With Scale of Airtel / Idea

Reliance Jio LaunchAt the AGM of Reliance Industries, Mukesh Ambani told that Reliance Jio Infocomm network will be ubiquitous, covering 5,000 cities and towns (90% of urban population) and 215,000 villages “initially”. To put these numbers in perspective, Airtel is present in 5,121 towns and 461,000 villages as of Mar-2014. Thus Reliance Jio’s network coverage at launch is likely to be quite comparable to Airtel / Idea’s in terms of reach (more so in terms of revenue targeting, given the urban markets have
higher ARPU’s and hence account for significant share of revenues). Over the longer term, RJio intends to cover all 600,000 villages across the Republic of India.

Target customers – it appears to be looking at “all sections of our society” – this indicates potentially a mass-market approach.

Reliance Jio employs 10,000 people directly, while 130,000 people from partner firms are involved in the rollout. To again put this in perspective, Airtel / Idea employ ~19,000/10,500 people directly in India, respectively. We suspect RJio is using outsourced staff more aggressively than incumbents.

As against expectations of launch in Dec-2014 quarter coinciding with Founder Dhirubhai’s Birth Anniversary, this suggests a quarter’s delay. While this means that the underlying tariff strength in the telecom sector has one more quarter to run before RJio’s launch.

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