Jio Fails To Stop Airtel, Vodafone & BSNL From Clinching Market Share!

So far Reliance Jio has been able to transform the whole Indian telecom industry in the last one and a half years with cheap data bundled with free voice calls and SMS. The Mukesh-Ambani-led company has successfully added over 170 million users, but other incumbents also have been able to grab a big portion of new users.

In spite of predatory pricing and free offers, Airtel, Vodafone, BSNL and Idea have been able to perform well in the market. After Jio was commercially launched in 2016, the market share among the operators changed drastically within a year. Reliance Communications, Tata Teleservices, Telenor, Aircel and MTS ran into losses and were forced to close down.

Jio Vs Other Incumbents: The Market Share Ratio

The current top three operators continue to dominate the table and have to add a substantial amount of subscribers last year. Though the revenue and profitability saw a sharp fall, the incumbents have kept adding new subscribers. The telecom industry has seen a 19 percent decline till now in the industry’s Adjusted Gross Revenue (AGR).

As per the figures revealed by telecom regulatory body TRAI, Airtel, Vodafone and BSNL have increased their market shares whereas Idea Cellular has retained its previous numbers. But, the profits have gone down, as the AGR has fallen to Rs 1.60 trillion in 2017 from Rs 1.98 trillion a year before.

Airtel has added 24.26 million users last year at a growth rate of 9.13 percent. Vodafone has added 7.84 million with a 3.83 percent growth rate and Idea added 5.98 million with a 3.14 percent growth. The state-run BSNL also added 11.13 million users at a growth rate of 11.50 percent.

Jio added the most number of subscribers with 87.93 million new users.

Declining Revenues

The Average Revenue Per User (ARPU) per month has declined to Rs 81.39 in 2017 which compared to Rs 118.65 a year back. The revenue from calls has seen a fall as well. In 2016, the revenue from voice calls stood at Rs 59, which has decreased to Rs 32.08 in 2017.

Data revenue remained constant at Rs 27.50 for both the years. Reliance Jio has the highest ARPU in the industry at Rs 137. In comparison, Airtel has an ARPU of Rs 116 and Idea has Rs 105. Vodafone is yet to declare its ARPU for the first quarter of 2018.

Voice realisation has fallen to 19 paise per minute in 2017 from 33 paise per minute in 2016. Though, the average minutes of usage per user per month has increased to 441 minutes in 2017 as against to 370 minutes in 2016.

As per TRAI, the composition of ARPU has declined in all the segments except ARPU from data usage.

Reliance Jio is the current front-runner of the Indian telecom sector and is planning to invest Rs 60,000 crore this year into its telecom unit to expand its wireless network. The company will continue to invest aggressively to kill its competition and acquire more users.