Jio disrupts home broadband in India with new 5G FWA offering

India's largest service provider, Reliance Jio, announced the launch of JioAirFiber, its Fixed Wireless Access (FWA) service, in eight cities of Delhi, Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai and Pune. 

The company is targeting to reach more than 200 million households, as per the recent speech made by Reliance Industries Chairman Mukesh Ambani at the recent Annual General Meeting (AGM) of Reliance Industries, the parent company of Reliance Jio.   

"With JioAirFiber, we are expanding our addressable market to rapidly cover every home in our country with similar quality of service. JioAirFiber will enable millions of homes with world-class digital entertainment, smart home services and broadband, through its solutions across education, health, surveillance and smart home," says Akash Ambani, Chairman of Reliance Jio Infocomm, in a press note issued by the company. 

Jio's basic offering, JioAirFiber, comes with two variants. The first one is available with a speed of 30 Mbps and a base price of INR599 ($7.20). This compares to Bharti Airtel's FWA offering, xStream AirFiber, which starts with a base price of INR799 ($9.60) per month, but it offers a speed of 100 Mbps. Airtel does not provide access to any Over-the-Top (OTT) channels like Netflix or Amazon Prime.

Jio's second variant offers a speed of 100 Mbps and is available for INR899 ($10.80) and INR1199 ($14.43), depending on the number of OTT channels one opts for. Jio also offers JioAirFiber Max with speeds of 300 Mbps, 500 Mbps and 1000 Mbps for INR1499 ($18.04), INR2499 ($30) and INR3999 ($48.13) per month, respectively. Jio would also be offering a number of smart home solutions, which will also help it to increase its market share from this segment.

Unlike its wireless offering, the pricing of Jio's AirFiber is not as disruptive. Jio launched operations in 2016 by offering free 4G services for the first six months. This introduced the country to high-speed mobile internet, which led to a massive increase in data consumption as well as in the number of wireless broadband users. In addition, the pricing of JioAirFiber is close to the company’s FTTH offering, JioFiber, with the only major difference being that the latter doesn’t offer access to OTT platforms. 

With Jio AirFiber, the company hopes the latent demand for high-speed internet will help it capture market share. What also helps Jio is that its closest competitor, Airtel, is offering FWA services in just two cities (Delhi and Mumbai), while it has launched services in eight cities to begin with. It also has more optic fiber when compared with Airtel.

Jio's fiber-to-the-home service, JioFiber, is the market leader with 9.17 million subscribers, followed by Bharti Airtel with 6.54 million subscribers, according to the June 2023 subscriber data released by the Telecom Regulatory Authority of India (TRAI).

Home broadband, whether through fiber or 5G-enabled FWA, is likely to see Airtel and Jio fight for greater market share. Airtel had a massive opportunity to gain an advantage in this segment if it had focused on home broadband before Jio’s entry. On the other hand, Jio has been focusing on fiber and has built an optic fiber network of 1.5 million km.

FWA is one of the most prominent use cases of 5G and is particularly relevant for India. The country has limited fiber connectivity, which is one of the reasons for low internet connectivity. India has only 35.10 million wired broadband subscribers as of June 2023, as per TRAI data. However, this segment is now likely to see massive growth, with 5G-powered FWA offering an opportunity to quickly add new subscribers and provide high-speed wired broadband connectivity.

According to GlobalData, India's total fixed communication services revenue is likely to grow at a Compound Annual Growth Rate of 6.4% from $10.2 billion to $13.9 billion in 2027.

New Street Research analyst Chris Hoare wrote today that the start of Jio's FWA service "by the leader in the world’s most populated country is likely to be game-changing for global FWA subscriber figures and is consistent with Reliance’s target of 100 million FWA customers in the medium term."