On last week we have heard many happy news from Reliance jio about the extension of Reliance jio free offers till March 2017. The main intention is that to increase the jio users to 100 millions. According to previous month statistics Reliance jio subscribers crossed 50 millions. But when this offer extended this open a tight competition between other telecom operators like idea,vodafone,airtel. Airtel announced mamy unlimited offers last week to counter jio offers. Vodafone also launches "Double Data" plans for 4G prepaid customers to compete with Reliance jio and unlimited voice calls. This shows that the other networks takes the challenge and the competition becomes more and more tighter.
Because of this tight competition reliance jio planning to extended the reliance jio free data and voice call offer beyond the limit march 31,2017.
“Jio may decide to extend freebies by a couple of months beyond March 2017 if incumbent telcos get more aggressive on 4G pricing,” Rajiv Sharma, telecom analyst at brokerage HSBC said in a note
Analysts at Religare agreed that aggression by Jio’s rivals so early on in the game means that market share gains for the 4G entrant will not come easy, especially with the low penetration of associated handsets.According to HSBC’s Sharma, the airtels new bundle pack suggest that the move was prompted by the high likelihood of Airtel customers subscribing to Jio as a second service.
The tariff changes came a week after Jio extended its free voice and data services offer till March 31, which is expected reduce data revenue and operating margins for the top three incumbents over the next two quarters.
Experts said the latest bucket plans indicate that Airtel, in particular, is willing to make a sacrifice and re-adjust to lower average revenue per user (ARPU) in an attempt to hold on to customers.
HSBC’s Sharma said Airtel could see “some ARPU erosion and margin decline” if its higher-end customers move to the new Rs 345 plan that offers 1 GB of 4G data and free local/STD calls to any network, although the data limit may not be too attractive for heavy users.
Religare does not think Bharti’s latest bucket plans would be “materially ARPU-dilutive for the company” but said it would strategically appear that the Sunil Mittal-led telco is “willing to toe the line” on free voice calls.
HSBC said the latest bundled tariff war could further “aggravate the difficulties” of GSM fringe players – Telenor India, Aircel and Tata Teleservices – which do not have comparable data services or data coverage. “We expect a rapid shift of pure 2G voice users to the low-end 4G plans (offered by top incumbents), which may accelerate sector consolidation and data penetration,” HSBC’s Sharma said.
