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How Reliance's ambitious 5G rollout plans can change India's digital story

How Reliance's ambitious 5G rollout plans can change India's digital story

With spectrum and a Rs 2 lakh crore capex outlay, the options appear to be unlimited across consumer and enterprise segments.

How Reliance's ambitious 5G rollout plans can change India's digital story (Photo: Reuters) How Reliance's ambitious 5G rollout plans can change India's digital story (Photo: Reuters)

The aggression demonstrated by Reliance Jio at the recently concluded 5G spectrum auction was the clear giveaway in terms of what to expect. At the annual general meeting (AGM) of Reliance Industries Limited (RIL), Chairman, Mukesh Ambani began his speech with what he had in mind for 5G.  

Here are the numbers to outline what RIL has in mind. Of the Rs 1.50 lakh crore that the government garnered through the auction of 5G spectrum, Jio’s outgo was over Rs 88,000 crore. Now, the gameplan is to cut across consumer and enterprise solutions with a suite of offerings. 

Ambani stated at the AGM that the capex for 5G services was Rs 2 lakh crore, which topped up with the spectrum spend, takes the total outlay to just short of a massive Rs 2.9 lakh crore. 

“The intent was very clear at the auction. Now, the attention will be on how the service will be priced. Overall, it must be said that the 5G announcement by Reliance is highly disruptive,” says Ambareesh Baliga, a market tracker. According to him, Reliance has been known to be cost-competitive and “that is unlikely to change.” 

The options before RIL for 5G are virtually unlimited. Kranthi Bathini, equity strategist at WealthMills Securities, points out that in 2016, Jio came in as the challenger with affordable voice and data tariffs. 

“That strategy worked well for them with a high-quality network, Now, the 5G offering is at a time when Jio is the market leader,” he explains. 

Agreeing that the consumer and enterprise segments can easily be addressed, Bathini maintains that a lot will depend on RIL’s speed of execution. “The real impact of 5G may not be felt immediately and one will have to wait for it to go pan-India,” he points out, before adding that the opportunities for 5G in areas such as “healthcare, education and agriculture are unlimited.” 

A lot of time for the consumer will now go into figuring out which 5G handset to buy and the cost of it. Industry trackers think the price differential that currently exists between 4G and G handsets will drop as more users start to come in. 

Baliga is clear that the ability to reach out to a larger universe of consumers will then see the real impact of 5G working. “Today, Jio cannot be viewed as just a telecom company but one that is more comprehensive with offerings across the board.”

Also read: Jio 5G phone announced in partnership with Google, expected to launch next year

Also read: RIL AGM: Reliance Jio to partner with Qualcomm to provide made-in-India 5G network