The India telco market is large enough to accommodate four healthy, growing, profitable pan-India players over the medium-to-longer term. Reliance Jio might actually help in accelerating/ catalyzing the adoption of highspeed, high-quality data in the country on SmartPhones and Tablets.
Even if this be true, what?s to say that the transition to a 4-player market will be smooth / frictionless and will be devoid of intermediate disruption to factors such as pricing (data/voice), capex, sub acquisition costs etc? If data pricing erodes, the data revenue CAGR thesis may be at risk even if the data volume CAGR thesis is not. Moreover, as we?ve discussed in our reports, we estimate data to be more
profitable than voice in India (as much of data sits on already existing voice infrastructure). So, if data pricing suffers (as a result of Reliance Jio or even otherwise), the impact on profitability can be disproportionate.
