It seems that this year-end would witness a war of the telcos. Reliance Jio strengthens its fight with arch-rival Bharti Airtel as the Mukesh Ambani owned company purchases key assets from Anil Ambani’s Reliance Communications. As a matter of fact, with this takeover, the Jio-Bharti battle would not only restrict itself to the mobile telephony but would extend to the fiber to home space (FTTH) also.
As per sources, while Jio is all set to launch its high-speed FTTH with the offer of broadband and TV next year, Bharti Airtel is also extensively planning for expanding its business. Right now, its fiber is spread over 250,000 km across the country and internationally.
But with this acquisition of RCom’s fiber assets which is about 178,000 km, Jio would have a much larger network, controlling more than 428,000 of inter and intra-city fiber across the country. Also as per sources, this would enable Jio to launch its FTTH in over 30 cities across the country next year.
Now, Jio, which was virtually the sole tenant of RCom’s 43,000 towers already as part of a 10-year deal which it had signed earlier, would also now become the sole owner of the assets. The deal would not only make Jio the second largest tower owner in the country with over 143,000 towers in its reserve, where Jio had already had 100,000 towers of its own), but would also help the company deepen its 4G coverage and take on Bharti Airtel more effectively. This might enable Jio to get closer to its target of acquiring another 100 million customers in the next 12 months, as per the experts close to the company.
On the other hand, Sunil Mittal’s Bharti Group, through Bharti Infratel and through their 42 percent stake in Indus Towers, effectively has an economic interest in over 90,000 towers. However, if there’s a remodeling of the business under which Indus Towers would merge with Bharti Infratel (with Infra buying out the stakes of Vodafone and Idea), Bharti would have over 170,000 towers under its belt. There are also indications that Bharti could reduce its holding in Bharti Infratel to a minority stake as part of its monetization plan.
Also, as per analysts, for Jio buying out the crucial 850 Mhz and 900 Mhz spectrum, which it got partly from MTS and partly through auction, makes sense because it expires only around 2033. This would give Jio stability and is crucial for taking the growing pressure of 4G data and expanding the customer base.