As the date for Reliance Jio's entry nears, we expect Airtel / Idea's voice revenue growth mix to shift more in favor of minutes? growth
when compared to voice RPM. We do not expect larger telcos to show voice RPM improvement, as we believe that they are selectively targeting mid- to low-end subs of smaller telcos. However, we expect MOU growth to remain strong, led by strong net adds.
Idea has been following this strategy for a while, and since last quarter, Bharti has started to follow this strategy as well. This would likely lead to continued market share gains for Bharti/Idea, as it is targeting subs from smaller telcos, blunting their low price advantage.
In the last few months, we note that larger telcos like Bharti/Vodafone/Idea have selectively raised data tariffs of high-end subs (which are less price sensitive). In our view, the larger telcos are trying to monetize data from this segment well and raise benchmark data tariffs in the market. However, we do not consider this strategy to be sustainable and expect data tariffs to decline with the launch of Jio?s services.
