Reliance Jio Executive on Why the Commercial Launch Hasn't Happened Yet

At the last AGM, company Chairman Mukesh Ambani had said the commercial launch would happen by December, which was then postponed to March.

The telecom venture of RIL, however, launched services for its employees late December and later extended them to their families and friends, taking the overall consumer base to a little over 5 lakh.

Asked about the delays in commercial launch, Reliance Jio's Strategy and Planning head Anshuman Thakur said, "There is no reason for the delay. It's first time that the LTE technology is being tested on such a large scale anywhere in the world.

"As it needs a lot of optimisation, which will lead to some disturbances in services, we want to ensure that once commercially launched the service is seamless. In fact the only delay is network optimisation. Also, we want to have a larger user-base of say a couple of millions at least (up from the present 0.5 million) to do the rollout." But he parried a query on what is preventing them from ramping up the user-base.

As against the national average of 150MB data usage, for Jio customers, who are getting free service now, it is 18GB and the highest usage come from states like Assam and Jharkhand, Thakur told reporters. The average voice usage is over 250 minutes within the first month of test-rollout.

In a statement earlier in the day, Ambani, without proffering a timeline, said, "Jio will launch commercial operations in the coming months and it is test-programme has established smooth operations of all aspects of the network over half a million users. The initial feedback is very encouraging and has established smooth operations of all aspects of the network."

RIL Group Deputy CFO V Srikanth said the parent RIL will be investing over Rs. 60,000 crores in capex in Jio this fiscal, an amount which is over and above the Rs. 1 trillion it has pumped in since bagging licence in 2010. At the Group level, the capex will be higher by Rs. 30,000 crores at Rs. 1.5 trillion.

The company has an equity capital of Rs. 45,000 crores while the debt component is around Rs. 33,000 crores. On the number of Lyf branded mobile handsets, he said they have already sold over 1.5 million units since November. Asked whether Rel Jio will be bidding for the spectrum

auctions in July, Thakur said the company is yet to take a call. Thakur said of the over Rs. 60,000 crore capex for the telecom vertical, some money will be spent on widening the network coverage to 90 percent as planned from the present 70 percent of the population.

He further said the company has around 90,000 telecom towers now, half of which owned by the RIL and rest on lease. At 90 percent network coverage, the number of telecom masts will be over 1 lakh.

Some money, which is yet to be finalised, will have to be paid to RCom for sharing its towers as well, he said but declined to quantify it.

The company has already made an advance payment of Rs. 2,800 crores to Reliance Communications (RCom), Thakur said.

Reliance Jio holds 751.10 MHz of liberalised spectrum across the 800MHz, 1800MHz and 2300MHz bands. In addition, RJIL has entered into agreements with RCom for change in spectrum allotment in the 800MHz band for nine circles and sharing of spectrum in the 800MHz band across 17 circles.

"This arrangement will be extended to the balance circles as well subsequent to pending approvals from the government, such that RJIL will have pan-India spectrum in the 800MHz band in addition to 2300MHz band," the company added.

Earlier this week, Reliance Jio launched a new 8,100 km cable system, the Bay of Bengal Gateway, which provides direct connectivity to Southeast Asia and West Asia, then onward to Europe, Africa and the Far East seamlessly.