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Asia’s richest man is handing out free 4k televisions
[MUMBAI] Three years after elbowing into the Indian wireless phone market with free calls and data, billionaire Mukesh Ambani is back at it.
This time, Asia's richest man is handing out TVs to hook users on movies and entertainment shows via internet. The tycoon is wedging into a business teeming with players from rival mobile carriers to Netflix and Amazon.com.
Mr Ambani's JioFiber broadband service, scheduled to start on Thursday across India, comes with a high-definition television and set-top boxes at no charge for annual lifetime subscribers. The offer by Reliance Jio Infocomm Ltd, the tycoon's wireless powerhouse, includes subscriptions to most premium streaming services with prices starting from 700 rupees (about S$13.50) a month.
The fiber-TV salvo comes days after Jio formally swept into the No 1 spot for wireless services after free calls and cheap data lured hundreds of millions of subscribers and left rivals Bharti Airtel and Vodafone Idea struggling under mounting debt. Airtel, backed by tycoon Sunil Mittal, and billionaire Kumar Mangalam Birla's Idea are also trying to lure users by offering access to TV and movie content.
Telecom carriers around the world are adding entertainment content to their offerings as a way to compete for users and add revenue, especially in markets where the number of mobile subscriptions has reached saturation. In India, video-on-demand growth itself is explosive, according to researcher Boston Consulting Group.
The market could leap to US$5 billion by 2023 from US$500 million last year, BCG estimates. The boom has set Bollywood production houses, carriers and streaming services racing to feed demand for TV shows and movies and compete for users. Paying subscribers will probably rise to as many as 50 million, while users of advertising-supported video-on-demand will reach 600 million, BCG predicts.
To gain the upper hand in the streaming business against well-funded competitors like Netflix, Amazon.com and Walt Disney Co's Hotstar, Jio will need to go beyond just offering cheaper access via bundled services, said Shailesh Kapoor, founder and chief executive officer at Mumbai-based consultancy Ormax Media Pvt.
So far, the telecommunications company has relied on alliances with TV and film producers to provide content for its service bundles. JioFiber will also include movies that can be seen by subscribers on the same day they debut in cinemas, Mr Ambani said in a speech laying out the plan on Aug. 12. That part of the service won't start until the middle of next year, he said.
JioFiber, which Ambani said is being offered at "less than one-tenth the global rates," can also disrupt the streaming market if Jio produces its own content and signs up the best talent for that, Kapoor said.
Airtel, the brand name for Mittal's carrier, may take the most direct competitive hit from JioFiber because, along with content bundles for its mobile services, it is one of the country's largest TV service providers. The company's digital TV segment accounted for about 12 per cent of earnings for the year ended March, data compiled by Bloomberg show.
In a possible attempt to get ahead of JioFiber's formal introduction, Airtel on Tuesday unveiled upgraded versions of its set-top box and the Airtel Xstream Stick, a USB device that allows an ordinary television to access OTT applications like Netflix, Amazon Prime Video and YouTube, along with Airtel's other content offerings.
Satellite providers such as Tata Sky Ltd and Dish TV India Ltd as well as cinema chains also face competition from Jio, which will offer fiber TV in bundles with its mobile services and free landline calling.
Shares of Dish TV fell 1 per cent in early Mumbai trading on Thursday, extending their decline to 12 per cent since Ambani unveiled the plans. That compares with a 2.1 per cent decline in the benchmark S&P BSE Sensex index. INOX Leisure Ltd, a movie-hall chain, has slid 11 per cent in the period.