Would Indian consumers in good time change their data habits sufficiently enough from the predominant lower density data type usage today (surfing, email, social media messaging/chats etc.) to high density data usage (streaming content), which would play to RJio's supposed strengths?
If yes, then the incumbents would need to also adapt to this scenario and make much greater investments (Airtel is relatively ahead of Idea / Vodafone in managing this scenario if this comes to pass). In this scenario, RJio would disproportionately gain as here it shapes the market with incumbents following duly.
Notably, we understand that data revenue growth in China took off due to much lower pricing in 4G; not necessarily due to any change in the nature of applications consumed. China is still not heavy on streaming, video downloads and other high density apps with average monthly data consumption per user < 1G/sub/month.
This seems a rather tall order to us, not least because we think the India market will be a predominantly lower density data usage market for some time, particularly for the larger sub base below the top quartile subs. Besides, a data growth expansion of this magnitude (i.e. 10% points of annual additional growth) to lift incumbents? growth seems a tall order for RJio as well.
