Reliance Jio, the name synonymous with disruption and massive change, can soon alter their business model, and jack up their tariff by 25%.
This claim has been made by a leading financial research and consultation firm; and if this news is indeed true, then it may have a far-reaching effect on the entire telecom spectrum of India.
Is the party for telecom users in India over?
We investigate.
Goldman Sachs: Reliance Jio Can Increase Tariff By 25%!
Just two days back, we had reported that Reliance Industries has presented Jio’s first, full fledged financial report, and the results suggested that despite showering free data and free voice, Jio is on the way to make profits.
However, it seems that the game of profits and revenues is something which will change a lot of things.
Global consultants Goldman Sachs have conducted a study into the on-going telecom war in India, and they have found that Jio may soon increase tariff for their popular Rs 399/- postpaid plan.
Rs 399 is the minimum plan for post-paid users, and provides 1 GB data every day for a month. With Diwali going on, the same plan now provides 1 GB data per day for 2 months.
In their report, Goldman Sachs said,
“We expect Jio to raise tariffs by 24% on its most popular plan (Rs 399) in the next few days, based on the pattern of its recent price hikes.”
Defining the timeline, the report predicts that the increase in tariff can be announced by the end of FY 2018, which is March next year.
How Much Will Be The Increase In Tariff?
As per the observations by Goldman Sachs, the price increase in the plans can be in the range of 24% to 95%, depending on the validity of the plan.
If we believe the report, then 24% rise in 3-month validity plans can be a possibility, whereas 47% increase for 2-months plans and whooping 95% increase in 1-month plans can be made.
The report said,
“With three months having lapsed since the last price plan change, new plans could be in the offing and we expect Jio to potentially raise effective tariffs by 24 per cent/47 per cent/95 per cent for three months/two months/one month plan in the coming few days, based on the patterns of recent plan adjustments,”
As per the latest report, Jio has 138.6 million customers, who are generating ARPU of Rs 156/-. In the last quarter, Jio was able to add around 15 million new subscribers, and since April, they have introduced paid plans.
Will Jio attempt to raise the ARPU by increasing tariff?
If they do, then Airtel and Vodafone and others will also follow suit, and the party would be over for the telecom user in India.
We will keep you updated as we receive more information on this.
Update: There has been no confirmation from Jio yet. Stay tuned as we update this post with the latest.