​​Airtel and Vodafone to keep price war on to counter Jio​

The telecom tariff war of discounts and freebies would keep continuing even though a few of the operators bleed badly. This, according to Crisil, would keep Bharti Airtel and Vodafone struggle to ensure Jio staying out of the game.

"At least, two out of the top three telcos will bleed in FY18, but competition will only heat up further as market leadership is always worth bleeding for," Ajay Srinivasan, Crisil Research director tracking the telecom sector told ET. However he refused to reveal the name of the telcos who will bleed.
"The profitability picture appears grim with aggregate Ebitda margins of the telecom industry (excluding Jio) expected to drop further by 50-to-100 basis points (bps) in fiscal 2017-18, which will be over and above the 600 bps drop to 29% estimated for FY17," said Srinivasan.

According to Crisil, while the overall data traffic has grown five times in the past one year, a 60% fall in 4G data prices since Jio's launch last September resulted in muted 2% growth in adjusted gross revenue (AGR) for the telecom industry in FY17.

Soon after Jio launched prime membership, letting subscribers use 1GB of data each day for 28 days, Airtel and Vodafone launched similar schemes. Also both the telcos have stopped roaming charges, inspired from Jio.