Telco giant Reliance Communications joined hands with software giant Microsoft to offer IPTV services in India. As part of the deal, RCom will pay $500 million to Microsoft for the latter’s license named Mediaroom under an exclusive agreement spread over eight years. RCom will further invest $500 million to set-up the infrastructure for the services.

Remember, the two companies are working with each other since 2003 on IPTV. The alliance has already conducted trials involving 20,000 households in Mumbai and Delhi.

“We will roll out services in the top 30 cities and in a few leading metros by early 2008, while the rollout in the remaining cities and towns will take place in a phased manner. We are also in talks with leading content providers in the country. As our launch is on a large scale, we will source content from most of these companies,” said RCom Chairman Anil Ambani.

The Chairman further added, “RCom will leverage its nation-wide infrastructure to deliver TV services, including video-on-demand, digital video recording, instant channel changing and personal media sharing”.

Microsoft CEO Steve Ballmer said on the occasion, “IPTV is in its early stage in India, but would catch up in 12-24 months. Most of it will happen in two countries, India and the US, and in India we are expecting tens of millions of customers”.