The 42nd AGM of Reliance was full of surprises with Reliance chairman Mukesh Ambani revealing some of their future ventures and plans for the organization. In the coming year Reliance plans to step into new fields which will have a major impact on India and its economy.
JioFibre, the much-awaited broadband service will be launched across India on the 5th of September this year. The service will provide several advantages like free calls from home and unlimited international calls at Rs 500 per month for fixed first-line services. Customers with annual subscriptions will receive a free HD/4k LED TV and a setup box; making it more attractive to the customers. Premium customers will also be able to watch new movies at home the same day it releases in theatres which is a scheme that will be unique to Jio alone. The Jio set-top box will also have 4k gaming which is a high-resolution gaming software that is used by most of the leading gaming platforms worldwide. With the expected price being within the range of 700-10000 per month and a plan that will go up to 1gbps, JioFibre is expected to give tough competition to the existing players in the industry. The shares of PVR Limited and INOX Leisure dropped by 8 and 10 percent respectively post the announcement of JioFibre launch. With the same day as release feature theatres face the risk of losing a large portion of their customer base to Jio. Direct-to-home (DTH) players like Airtel and Tata Sky will also have to watch out as their broadband services are currently providing services at a rate higher than the rates proposed by JioFibre and their offers are also not as attractive as Jio’s services.
While the Digital India campaign has made good progress, Jio Infocomm is teaming up with Microsoft to take digitalization to a whole new level by setting up world-class cloud data centers across India by 2021. Jio-Azure powered by Microsoft’s Azure is aimed at startups along with small and medium businesses (SMEs). The venture will provide easier access to cloud-based productivity, business applications, and other tools that will help these SMEs and startups grow digitally. As a part of the collaboration, Jio-Azure will also offer Microsoft Office 365 suite and email exchange support to startups. While their main customer base will be SMEs and startups they will also provide custom solutions and affordable access to services like AI and blockchain for large enterprises, essentially covering all types of businesses. Jio’s entry into the telecom sector in 2016 shook the entire industry, running some of their competitors into the ground; Jio Azure could create similar waves in the cloud services platform. The low pricing strategy that has been opted by Jio could lead to a price war as the same services are currently being provided by Google and Amazon web services at a much higher rate. Existing competitors will be forced to come up with new pricing strategies to meet the competition.
Perhaps one of the most startling announcements made by Ambani was the plan to make Reliance a zero net debt company in 18 months. The BP deal wherein Reliance sold 49 percent of its stake in its fuel retail business will bring Rs 7000 crore and the Saudi Aramco deal will bring another Rs 15 million which will help reduce debt. Reliance Retail and Jio will be going public soon which will further help reduce debt. By March 31, 2021 reliance aims to achieve the status of being a zero net debt company. Ambani has assured higher dividends and periodic bonus issues once they reach zero debt.
Reliance has always been a gamechanger and these new ventures will also create waves in the Indian economy. While customers can rejoice, competitors will have to buckle up to face Reliance who is proving to be a formidable competitor.
OFFICIAL MEDIA PARTNER: NEWSWIRE
OFFICIAL PROMOTIONAL PARTNER: IBS MESSENGER
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