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Jun, 28 2018

Mukesh Ambani's Jio eyes long-term revenue with more educational programmes

As of now, Jio’s offerings for children mainly includes movies, cartoons and nursery rhymes in multiple languages under Jio TV.

With the aim to help tie in long-term revenue for the Mukesh Ambani-led mobile phone operator, Reliance Jio Infocomm plans to offer a range of online tutorials and vocational training programmes aimed at children, middle and high school students.

According to people familiar with the matter, the telco's content team is strategising ways to introduce a specialised line of ‘edutainment’ programmes an untapped area and a big shift from the more regular content offerings in music, sports, movies etc.

“The operator is looking at kids and students’ content programmes and ways to provide education along with entertainment,” a source aware of the development said.

As of now, Jio’s offerings for children mainly includes movies, cartoons and nursery rhymes in multiple languages under Jio TV.

Analysts say the move towards ‘edutainment’ will be an important one for the telco with over 186 million customers since this unpenetrated segment is sure to get traction from both the target audience and their parents.

According to an analyst aware of Jio's content development programme, the telco has created a project team of some 10 people who will be looking after education and the possibility of vocational training via Jio's digital medium.

This offering may help Jio get closer to its target of 50% revenue market share by 2021, from around 20% now.

“Jio is looking at creating a platform where students can be given online training in different subjects. It will be something like edutech company Byju’s and similar tutorials who are a hit amongst the student community,” said a company executive aware of the developments.

Byju’s, which teaches school students via its learning app, has about 20 million registered students and 1.26 million annual paid subscribers since its launch in 2015.

"Today, 80-90% of revenue from content will come from entertainment but going ahead, health and education will be key drivers. And this is what Jio wants to get a headstart in," said the analyst who did not want to be named. He added that although in its nascent stage, the team is on the lookout for more partnerships or acquisitions through which tutorials can be conducted.

Jio has already taken the first step. For instance in April, Jio’s parent Reliance Industries said it will be buying a 72.69% stake in Indiavidual Learning Pvt Ltd that operates the online education platform Embibe.

According to the people, the newest operator in the industry will make use of the increased penetration of smartphones and an increased affinity towards online training courses to capture the students’ loyalties.

According to analysts, the online education segment, which is at a nascent stage, mainly consists of videos, and telcos have immense potential to tap into this area.

“What automation did to banking, e-learning will do for education. The way IT companies benefited from tapping into automation, telcos will, by providing education via their content services,” said Narayanan Ramaswamy, partner and head of the education practice at KPMG India.

He said moving ahead, with 5G roll outs, it will be possible to seamlessly move between classrooms, e-learning courses, taking exams and getting linked to related subject matters as per one’s convenience.

Content is becoming one of the key revenue generators for the industry as tariffs have bottomed out and average revenue per user is at all-time lows. Jio has been at loggerheads with Bharti Airtel, Idea Cellular and Vodafone India over content-based exclusive offerings in sports, movies and television programmes.

Telcos are betting that about 90% of that content will be via video and are already coming up with various subscription-based plans. Jio, Airtel and Vodafone currently offer their TV app for free, but are expected to charge at a later date, experts said.

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