There is some bad news for Reliance Jio’s rivals, and excellent news for Jio patrons: The age of freebies and discounts from Jio can continue for next 12-18 months, as predicted by leading telecom analysts from US and India.
As per reports coming in, Jio has set its eye on capturing more and more market share, and their role model in this endeavour is Verizon, the leading telecom service provider in the US which controls 50% of the market.
But, as analysed in the reports, the limiting factor for Jio’s ambitious expansion plan in India is not data price, but hardware. As the 4G market saturates, the availability of 4G handset users has now become the #1 obstacle for Jio.
How will Jio react now? Free 4G handsets, just like in the US, can be a possibility.
Jio’s Ambitious Plan: 50% Revenues Of Indian Market
By 2020, Jio has set a target of capturing 50% revenue of Indian telecom market, and in order to achieve this, they will keep on pushing free offers in India.
In fact, as per a report created by Morgan Stanley, Jio is aiming to scoop out 15% market share (by subscription) by end of 2017 fiscal year, and this means that more free offers can be launched in the next 12-18 months.
As of now, for December quarter, Airtel commanded 33.1% revenue share in Indian telecom industry, Vodafone had 23.5% share, Idea has 18.7% share.
Limiting Factor for Jio: 4G Users, Not Data Price
Jio had been adding new subscribers at a rate of 600,000 per day for the first 170 days when it added 100 million users.
However, in the next 40 days, the rate of new users dropped significantly, as Jio added 225,000 new users per day, as it added 9 million users to their platform, thereby taking total user base to 109 million.
Now, there are only 134 million 4G users in India. And out of that, 109 million are already on Jio’s network.
This means, that saturation level has already arrived, and data price is no longer a limiting factor for expanding their network.
Every month, 7-9 million new 4G users are added in India, and this is the market which Jio aims to target as of now.
Interestingly, besides Morgan Stanley, Crisil has also stated that other telecom players will continue to bleed, as Jio will offer more free offers in the coming days, in order to lure new customers of the 4G network into their platform.
Rs 1.5 lakh crore telecom market is all set to witness more blood now."Jio To Extend Free Offers For Next 12-18 Months; Wants 50% Market Share in India!",