Small Internet Players Can Perform Better Than Big Players: Report

Even though it is expected that Reliance Jio might disrupt the broadband sector as it did in the telecom sector, all other players are trying to cope up with the ongoing situation. Notably, all small and big internet players have launched affordable packs to attract users.

However, a new report by research firm Motilal Oswal said that despite Jio has an aggressive internet plan, it might not have a huge impact on the sector. It said that wired broadband is quite established in the other parts of the world, but the situation in India is different as companies are not making huge investments, which is actually forcing people to move ahead to wireless communication. The research firm also highlighted that small players also have opportunities to grow their business.

"It has largely been an urban product, with low penetration of 7 percent - due to limited network connectivity with just 80-100 million estimated home passes - which has restricted subscriber growth. This has given way to increased wireless consumption in India, which has a far easier and convenient installation/activation," Motilal Oswal said in a report.

Notably, Reliance Jio launched its internet services in 2019 to disrupt and to give a tough fight to Airtel broadband plans. At present, these two internet players are operating are expanding their reach in other parts of the country as they are majorly focussing on tier 1 cities. Both are offering services in large societies and huge buildings.

"To increase its reach, RJio may have to aggressively ramp up home passes - it requires 150 million home passes (50 percent of the total households), assuming a 33 percent conversion ratio (against the industry standard of 15-20 percent)," the agency said. Furthermore, the report highlighted that Airtel and Reliance Jio are looking at small towns.