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Breaking News :  Reliance Jio Media puts cable TV launch on slow track
Saturday 31-October-2015, 00:44,
Reliance Jio Media puts cable TV launch on slow track
MUMBAI: Reliance Jio Media has put
its cable TV launch in Phase III towns
of digital addressable system (DAS) on
the back burner, implying that the
entire focus of India’s richest man
Mukesh Ambani will initially be on the
fourth-generation (4G) telecom play
and broadband rollout.
Changing the original plan of
aggressively entering the MSO (multi-
system operator) business in DAS
Phase III towns ahead of the 31
December 2015 deadline, Reliance Jio
in its first outing is looking at tying
up with local cable operators (LCOs)
for broadband only. Talks have already
started with the LCOs for partnering
on broadband services and a
commission fee structure is being
worked out.
“Cable TV will not be the first horse
out of the Reliance Jio stable. The
priority is on launching 4G services
while simultaneously working on the
wired-access fibre-to-the-home
[FTH] project. LCOs are being
approached for broadband and not for
digital cable TV services, ” a source
familiar with the development said.
Digital cable TV is turning into a black
eye for several networks. With the
MSO–LCO tussle on revenue share
continuing and packaging of channels
for consumer selection largely
absent, the business model for digital
cable needs to evolve. Reliance Jio
Media could be waiting for the
business norms to correct before it
steps into the MSO business.
“Reliance Jio Media officials have
been talking to us on partnering for
broadband. They have not been talking
on tying up with us for cable TV
services. There is no mention of
digital headend or set-top boxes. .
Knowing Reliance, the plan could,
however, change if an opportunity
arises,” several LCOs across cities
told TelevisionPost.com.
Incidentally, Reliance Jio Media, a
subsidiary of Reliance Jio Infocomm,
has procured a pan-India MSO licence
from the Ministry of Information &
Broadcasting (MIB).
So, what is on offer for the LCOs?
“Reliance Jio is willing to offer us a
commission of 10–12 per cent on
broadband revenues. We can be with
them on a non-exclusive basis. What
this means is that we can continue
with whatever broadband services we
are already offering. They will invest
in infrastructure and will own it. The
deal being proposed is for five years,”
echoed the LCOs, preferring
anonymity.
Several cable operators said that the
commission on offer is not lucrative
enough. “As resellers of bandwidth,
we operate on higher margins. Even
when we provide broadband services of
MSOs, the commissions are higher,”
they said.
Reliance Jio, however, believes that
while margins are going to stay
competitive, volumes will be the main
attraction. Besides, aggressive
pricing, higher speed levels and better
services will put pressure on LCOs to
join the Reliance Jio camp.
The 4G wireless scale-up is happening
at a furious pace as the launch is
expected in December. The FTH route
will take longer time as physical
infrastructure needs to be in place.
The initial focus is on the bigger
cities including Mumbai, Delhi,
Bengaluru, Hyderabad and Pune. For
wired connectivity, the company will
take the help of the LCOs to reach
homes. The operators are also being
tapped in areas where mobility
requires support.
Why is Reliance Jio looking to partner
LCOs? The LCOs will provide last-mile
access to the consumer homes. Though
Reliance Jio has already laid 250,000
km of fibre-optic network until June,
it has still to connect individual
homes. Cable operators will provide a
faster growth route and can be
construction partners by cabling and
wiring up the building.
Reliance Jio has planned an FTH
arrangement to offer TV channels to
consumer homes. The overall plan is to
be a formidable quad-play service
provider. The bet is to change the
landscape with internet, TV, landline
and wireless provisions.
Will Reliance Jio Media miss the cable
TV bus if it does not participate in
Phase III of DAS before the deadline?
Media analysts say that the company
could look at acquiring LCOs,
independent operators or MSOs once
the market settles down. Sporadic
launches also could happen before
scaling up.
“Capital is not an issue with Reliance.
It could wait for the business
dynamics to change after DAS settles
in. Then it can decide on whether it
wants to take the acquisition route or
lure consumers by bundling its multiple
services at affordable prices,” said a
media analyst at a broking firm.
http://www.televisionpost.com/cable/reli...low-track/
ANIL G
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