Reliance Jio May Invest $23 Billion Over 3-4 Years to Expand Beyond 4G Services: Report

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Mukesh Ambani-led Reliance Jio Infocomm is likely to invest around $23 billion on capital spending over three to four years to expand its operations beyond wireless services, having already spent over $31 billion to create India's largest 4G network, according to an estimate by Moody’s Investors Service. Moody's analyst told Bloomberg that Reliance Jio would be making the investment towards its fiber-to-home, digital TV and the enterprise business in addition to improving mobile phone services. The telco will also invest some of this investment towards its 4G feature phone.

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Reliance Jio is planning to soon launch enterprise services in the country, having cornered around 160 million 4G customers in the country since its launch in September 2016. The 4G entrant is planning to launch enterprise services like unified communications, Multiprotocol Label Switching (a protocol for high-speed telecom traffic) networks, Internet Protocol-Virtual Private Networks, cloud services, and managed video-conferencing, among others.

The telco had reportedly conducted a soft launch of the services and demonstrated the services recently. It is said to be in the final phases of testing its enterprise offering, which is the definite logical step in its growth path.

CLSA, in a recent note, had said that Jio's focus this year will be on raising average revenue per user (ARPU) from its smartphone users and ramp-up in its 4G feature phone users in the country in 2018, besides making efforts to launch home-broadband or FTTH service and enterprise solutions to further monetise its wide optic fiber network.

“We believe that a major re-rating in long-term is likely if Reliance gets a bigger share of customer wallets beyond telecom; beefing up its online retail and content offering will help,” CLSA had said. The brokerage had said that the Mukesh Ambani-led telco is also expected to use third-party advertising, promotions and original content on its content apps to monetise its big customer base like it did with a popular game show recently.

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