Reliance Industries said it will commercially start its 4G telecommunication services around December, offering a timeline for the launch of a key diversification move that investors have long awaited.
Reliance, which re-entered telecoms in 2010 by acquiring the only company that had won nationwide 4G airwaves in a government auction, is yet to start services as it builds the business under unit Reliance Jio on an unproven and still-developing technology.
That has caused concern among analysts and investors, who feel Reliance has little to show for the more than $15 billion (roughly Rs. 94,609 crores) spent on digital business including the Jio venture so far and that it has limited experience in consumer-facing businesses. The announcement of a concrete roll-out plan could assuage some of those concerns.
“Over the next few months, we will initiate an extensive beta launch,” Reliance Chairman Mukesh Ambani, India’s richest man, told shareholders on Friday.
“This beta program will be upgraded into commercial operations around December of this year,” he said, adding the financial year to March 2017 will be the first full year of commercial operations for Jio.
Reliance Jio will push to get cheaper devices into the market, Ambani said. He expected 4G LTE smartphones priced below 4,000 rupees ($63) to be available in the Indian market by December.
A successful launch of Jio could potentially disrupt the sector which has over the past few years been dominated by incumbents. Jio would compete with the likes of Indian mobile phone market leaders Bharti Airtel Ltd and Vodafone’s local unit.
Reliance Industries, India’s second-largest company by market value, gets most of its revenue from its sprawling energy empire, which includes the world’s largest refinery complex in Gujarat.
It has, over the past few years, focused on expanding into newer areas such as media, retail and telecommunications to counter a slowdown in its energy business.
Reliance’s retail business, the largest in India, will expand to more than 900 cities by next year from 200 cities now, Ambani said.
Reliance shares were up 1.5 percent on Friday afternoon, compared to a flat Mumbai stock market.