Reliance Industries’ Mukesh Ambani launched Jio, the 4G enabled telecommunications network last year in September. It made waves at the time of its launch as many Indians joined the network for the free services it was offering, till December 2016. This offer has now been extended for another three months. This smart move by RIL forced the other players in the Indian telecom market into announcing a few freebies of their own. Let’s take a look at how Jio changed India’s mobile and Internet landscape:
Jio has forced its rivals to lower mobile tariffs
Jio had offered free voice calls not only from Jio-Jio, but also from Jio to other service providers. Ambani had also said that RIL would give its users the lowest tariffs. Jio, thus acted as the disruptive factor in the telecom market, leading Airtel and others to slash their data tariffs too. This is beneficial for users of all networks, but the future will tell if the tariffs stay down.
VoLTE handsets sold in millions
According to reports, Jio’s 4G technology catapulted the sales of VoLTE handsets. These VoLTE handsets allow voice calls to be converted into data, when 4G network is in use. 80% of smartphones shipped in Q3 (2016) i.e. the July to September quarter, which were VoLTE compatible as compared to 30% (2016) in Q1 i.e. January – March. According to surveys, 90% all smartphones shipped in 2017’s Q1 would be VoLTE enabled. Lenovo, Samsung, Xiaomi and Lyf are the major brands which cater to the VoLTE category. Looking at the statistics, experts are predicting that VoLTE might become the basic default smartphone technology in India.
The growth of Jio has been phenomenal
One month after the launch of Jio, the network claimed that it had subscribers amounting to 16 million. This, RIL claimed was the first time this had happened in India. Many analysts believe that the network would have approximately 25 million users, as it adds 1-1.2 million people every day. Airtel leads with 35 million 4G and 3G users, Idea and Vodafone have 25 million users in total. Experts are predicting 100 million users of Jio, which will enable it not only to break even, but also to make a good profit.
Jio is making its presence felt on the balance sheets
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Jio’s free offering made its presence felt on the balance sheets of its rivals. There was a 4.9% decrease in Airtel’s Q2 (2016), even though there was an increase of 24% in its data revenue. Idea fared worse with a 19% decline in data revenue. Analysts say that the existing telecom operators might make voice calls made over VoLTE free, in order to compete with Jio, even though doing this would make a further dent in their balance sheets.
Other players have joined forces due to Jio
After the launch of Jio, Anil Ambani announced the merger of Reliance Communications with Aircel, resulting in the creation of an entity worth Rs 65,000 crore, and is in talks with Sistema, Russia, even though Jio shares RCom’s towers, fibre, network and spectrum. This might be the first of mergers, as smaller players in the telecom industry may merge with the giants in order to survive.
Jio’s impact on online content
Jio’s cheap data rates would mean that people would watch online content more than they used to. It’s good news for online video streaming services like Netflix, Hotstar and Amazon, who want to get into the Indian online content market. Jio offers free streaming (till 2017 end) of over 300 TV channels and hundreds of movies and channels. Jio’s competitors might have to think of new strategies to attract users to use their online streaming services.
Jio offers fastest downloads
Jio’s 4G has the fastest downloads, but it is at number four when it comes to uploads. Recently, Airtel has been airing ads claiming to be the fastest, which Jio refuted and now the ASCI has asked Airtel to withdraw or modify its ads.
Jio has made a big impact on India’s telecom industry, as it’s disruptive market strategies has allowed it to gain millions of subscribers, and it will be interesting to see is it is able to retain the millions of users once the freebies end.