Author Topic: Will Reliance Jio Continue Discount Model ?  (Read 330 times)

wiredlife

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Will Reliance Jio Continue Discount Model ?
« on: August 10, 2016, 11:19:38 AM »
Reliance Jio Infocomm seem to have taken a very unorthodox approach with their soft launch that is comparable to ecommerce companies, which launch initially with lots of discounts and focus on getting footfalls and worry about monetization later. The initial usage patterns are surprising and far higher than even global averages. However, it remains to be seen what usage patterns and consumer behaviour will be once subscribers start getting charged for the same.

Indian consumers / subscribers may behave completely differently once being charged for service. Moreover, if the 4G entrants were to
delay charging subscribers too much, it may become hard to monetize their data offering. Reference can be made to e-commerce players in India, some of which seem to have had difficulty getting traction after taking away the initial discounts/offers.

Micro Recharges
Incumbent telcos have suggested that a large part of the Indian market is focused on low-denomination recharges. Much will depend on how incumbents respond to 4G entrants. If the response is to offer cheaper data and smaller packs, 4G entrants could be forced to compete on micro offerings, which may prevent them from monetizing their value proposition around network data capacity.