How Reliance jio fibre will disrupt the broadband market



“Aggression is the first step on the slippery slope in selfishness and chaos”

The quotation is best understood by the business model of Jio which has literally shaken up the whole Telco-broadband ecosystem. Launching its internet service in 2016, the company has gathered a whopping 340 million customers within 3 years. This has put companies like Vodafone-idea and Airtel into the red for multiple quarters. Also, the speed at which they are losing customers is putting tremendous pressure in the survival of the business. Reliance jio is targeting 500 million customers in the next few years which will be second only to China mobile communications having a 900 million customer base.

After disrupting the mobile market, the company is now back with Reliance Jio fiber for more disruption. This time the local cable operators and private players like Dish TV and Videocon d2h are feeling the heat. So what is it that is bothering the internet service providers? Well long things short, Jio Fiber is allowing free voice calls from landlines, a minimum speed of 100 MBPS starting at 700 and free HDTV for those subscribing to the annual plan. The benefit of video-calling and conferencing, enhanced security measures, 4K tv for an upfront payment of 31000 are quite lucrative and revolutionary the broadband space.

Report by CLSA says that Jio fiber plans are 13-23% cheaper compared to rival companies. However, with lower data allowances, customers will have to brainstorm whether they would continue with their existing plans or shift to more expensive ones. In the long run Dish TV and Bharti Airtel would suffer owing to the multi-pronged strategy and facilities given by Jio fiber. Speed, which is the main concern of internet users, is substantially high in Jio. In addition to that a range of 100 Mbps to 1 Gbps is turning heads both in the industry and outside.

Let us compare the basic plans of Jio fiber compared to rivals.

Basic Plan comparison

COMPANY PLANS PRICE DATA NETWORK SPEED
BHARTI AIRTEL BASIC 799 100 GB 40 Mbps
JIO FIBRE BRONZE PACK 699 100GB + 50GB extra for the time being 100Mbps
AIRTEL PREMIUM PACK 1599 600GB+1000GB for 6 months

4K set top box+video calling Norton security for 5 device+3 month subscription to OTT apps

300 Mbps

 

Moderate Plan

BHARTI AIRTEL ENTERTAINMENT PACK 1099 300 GB

Unlimited local and STD calls, 1-year subscription to Amazon Prime, 3 months subscription to Netflix and Zee5+500GB data for 6 months

100 Mbps.
RELIANCE JIO SILVER PACK 849 200 GB FIXED+ 200 GB extra for the moment free landline connection+4K set-top box+video calling. Norton security for 5 device+3 month subscription to Netflix 100 Mbps

 

Premium Plan comparison

AIRTEL VIP PACK 1999 Unlimited Data+No FUP limit

.

Free subscription to Airtel Xstream,+ 1-year subscription to Amazon Prime Video + 3 months subscription to Netflix and Zee5 premium subscription 100 Mbps
JIO GOLD PACK 2499 1250GB +250 GB extra for now 500 Mbps

 

 

The table clearly shows the speed advantage which Jio is having over its nearest rivals. It has become the benchmark of faster downloads and live streaming outperforming its rivals by miles. As per reports by McKinsey, Indians are consuming 8.3GB data on a monthly basis. By 2023, 750-800 million Indians will be using the net. At the higher end of the spectrum it could go up to 835 million in 2023. Jio Giga Fiber is sensing a goldmine with the huge Indian population getting digitized. Apart from increasing their customer base at breakneck speed, they are maintaining their USP of fastest downloads.

In July 2019, as per Netflix ISP speed index, GigaFiber has been in the top 3 in terms of speed with an average of 3.5 Mbps.  7 star digital and Spectranet are the top two with speeds of 3.53 Mbps and 3.52 Mbps respectively. However, GigaFiber beats Airtel V-fiber (3.4Mbps) and Hathaway broadband (2.89 Mbps) handsomely. So the competition is turning fierce and both local operators and telcos are bearing the brunt of customer dissatisfaction. This is an ominous sign for the competitors.

So what next?

Market analysts are sceptical regarding the amount of disruption that Jio can cause here. This is because they believe that unlike the mobile plans, there is nothing free or the pricing is not at an extremely low level. However my opinion is that a lot of the 340 million mobile customers will be switching to the internet even at a slightly higher cost. This is because the bundle packs will give them greater customer benefits.

Final Words

Local broadband companies are hoping against hope that they maintain their existing customers. But the disruption is bound to occur because services like OTT apps, Netflix subscription and video calling is not coming with Siti cable or Hathaway connection. Hence the Jio GigaFiber will storm the already existing internet market and change the dynamics. A message to other competitors: Increase your speed or perish.

Want to know about detailed Jio GigaFiber plans. Visit https://www.jio.com/en-in/faq/jiofiber/plan-details/what-is-the-current-plan-offer-in-jiofiber.html