Reliance Jio forms JV to offer satellite broadband in India

In a major development in Indian mobile space, Mukesh Ambani-owned Reliance Jio has formed a joint venture to deliver satellite-based broadband services in India. Jio Platforms, an arm of Reliance Industries, has teamed up with SES, a global satellite-based content connectivity solutions provider, to form a joint venture – Jio Space Technology – to deliver the next generation scalable and affordable broadband services in India leveraging satellite technology, RIL said in an exchange filing on Monday.

Jio Platforms (JPL) will own 51% equity stake in the joint venture (JV), while SES hold the remaining 49% shares in the entity.

“The joint venture will use multi-orbit space networks that is a combination of geostationary (GEO) and medium earth orbit (MEO) satellite constellations capable of delivering multi-gigabit links and capacity to enterprises, mobile backhaul and retail customers across the length and breadth of India and neighbouring regions,” RIL said in a filing to the BSE.

The JV will offer SES’s satellite data and connectivity services in India, except for certain international aeronautical and maritime customers who may be served by SES. It will have availability of up to 100 Gbps capacity from SES and will leverage Jio’s premiere position and sales reach in India to unlock this market opportunity.

As part of investment plan, the joint venture will develop extensive gateway infrastructure in India to provide services within the country. Jio, as an anchor customer of the joint venture, has entered into a multi-year capacity purchase agreement, based on certain milestones along with gateways and equipment purchase with total contract value of circa $100 million.

Commenting on the development, Akash Ambani, Director of Jio, said, “While we continue to expand our fibre-based connectivity and FTTH business and invest in 5G, this new joint venture with SES will further accelerate the growth of multigigabit broadband. With additional coverage and capacity offered by satellite communications services, Jio will be able to connect the remotest towns and villages, enterprises, government establishments, and consumers to the new Digital India. We are excited about this new journey combining our massive reach and customer base with SES’s innovative leadership and expertise in the satellite industry.”

In the backdrop of Covid-19 when broadband has become imperative for boosting digital economy, the JV will act as a catalyst for connecting the unconnected areas within India and the region to the full range of digital services, offering access to remote health, government services, and distance learning opportunities, RIL said.

The new venture will leverage SES-12, SES’s high-throughput GEO satellite serving India, and O3b mPOWER, SES’s next-generation MEO constellation, to extend and complement Jio’s terrestrial network, increasing access to digital services and applications. Jio will offer managed services and gateway infrastructure operations services to the joint venture.

The joint venture also aligns with Prime Minister’s ‘Gati Shakti: National Master Plan for Multi-modal Connectivity’ initiative to provide integrated and seamless connectivity by implementing diverse infrastructure. It will also accelerate the achievement of the Connect India goals in the 2018 National Digital Communications Policy and the Digital India programme by expanding broadband connectivity to Indian citizens across Indian geography, RIL said.

Meanwhile, shares of Reliance Industries were trading 2.13% lower at ₹2,326.2 apiece on the BSE.