Reliance Jio 4G gaining share from ALL operators

The industry revenue figures for the Jun-17 quarter recently released show headline improvement in market share for incumbents – but that is not representative of customer wallet as Jio has not reported revenues.

While on a Gross Revenue basis, 35-45% of Jio’s market share gains has come from top-3, the improving traffic mix for Jio means ~60% of market share gains on AGR level are from top 3. We believe Airtel has lost at least 80-200 bp market share since Jio’s launch, while Vodafone+Idea have lost 160-240 bp.

Jio is yet to report revenues from the telecom business, and we believe the TRAI reporting primarily captures only the interconnect payments and (more…)

Will TRAI Go Neutral on Predatory Pricing Tariff War by Jio ?

The Indian Telecom Regulator – TRAI will decide on issue of predatory pricing in the next few weeks. In response to the consultation paper floated by the regulator in this regard, incumbent telcos (Airtel and Idea) have asked for following considerations – (a) Investments in 2G and 3G technologies cannot be ignored under the logic of obsolescence (b) asked for treating 4G/3G/2G services as a separate class of service. Additionally asked to treat wireline and wireless as separate services. (c) Not allow pricing below interconnect charges (IUC) and IUC should be computed on full costs.

Reliance Jio Infocomm is not in favour of (more…)

Jio VoLTE Basic Feature Phones for Rural India with 2G Coverage

Reliance Jio was able to acquire 800MHz spectrum in 13 of India’s 22 circles. It is yet to orient this network for rural coverage. The company also signed spectrum sharing and spectrum trading agreements with Reliance Communications to complete pan-India 800MHz spectrum footprint. Jio is awaiting clearance from the Competition Commission of India.

Jio plans to roll out 4G VoLTE-enabled feature phones at Rs 999- 1,800. Insiders report indicate the following about Jio’s 4G feature phones. Jio is looking to launch two variants under the LYF brand. One with a Qualcomm 205 chip and another with Spreadtrum chip. The phone could have the following specifications – 2.4 inch display, 2 MP front and rear camera, WiFi and Bluetooth connectivity. It could have (more…)

Jio’s 4G Subscriber Addition Done – Incumbents Fight Back

Reliance Jio’s net active customer addition slowed down further in April to 0.4m compared to 4.1m in March. This number has been slowing every month since December (13.7m net adds) and indicates to us that majority of customers with 4G devices who wanted to try Jio services are already using Jio and incrementally the customer additions will depend on increase in VOLTE device penetration.

While Jio started charging in April, it had not deactivated the non-paying customers in April and thus some of its subscribers are likely to have (more…)

Jio Kills Cash Registers of Airtel, Vodafone, Idea Lobby

Jio’s business case, at some level, needs the support of an industry size that is materially larger than what it is today. Jio has a reasonable business case in a market where the other incumbents Airtel, Vodafone and Idea – A-Vo-Id lobby has one.

Jio is well funded by its parent and its discounting model is hurting the A-Vo-Id Lobby and it can potentially drag the industry size down to such low levels in the near term that raising it to the needed for a reasonable business case levels within a reasonable time frame may become near impossible.

In the Worst Case a 60%+ yoy decline in India wireless EBITDA levels of the industry (ex-Jio) in FY2018 to under Rs 200 bn levels. For an industry (more…)

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