The Hindu Business Line : RCom: Trying to deliver on a different platform?

Amidst the controversy surrounding allocation of spectrum in the mobile services front, Reliance Communications (RCom) has joined the IPTV (Internet protocol television) bandwagon. RCom has announced a deal (pegged at $500 million by reports) with Microsoft, for launching this service. Under this deal, Microsoft would license its ‘Microsoft Mediaroom’ IPTV software platform to enable RCom to deliver feature rich content and deliver ‘interactive entertainment’ to customers. The service is expected to be launched in March 2008, initially in Mumbai and Delhi, which are high average monthly revenue per user (ARPU) circles for mobile services. RCom would look to leverage on the huge IP-based NGN network that it has built for providing this service. It has established ethernet connectivity to nearly 5 lakh buildings in the country, which is huge plus for launching this service.

For operators grappling with falling ARPUs in the mobile segment, these launches may help provide alternative revenue streams. But there are challenges ahead. The success of IPTV as a technology in the market remains to be tested. Last mile connectivity still remains a challenge in India, and broadband penetration is extremely low in India.

Challenges

MTNL, which has already launched IPTV service some time ago, may not have achieved the desirable penetration levels yet. RCom will also face challenges from BSNL and Bharti Airtel, who will be launching IPTV services soon.

Competition also exists from highly successful DTH players – Dish TV and Tata Sky.