Reliance Jio’s new offering of free voice calls and data is likely to bruise Airtel, Vodafone India, Idea

Mukesh Ambani-led Reliance Jio’s Happy New Offer, rolling out free data and voice calls, is likely to hurt data revenue growth of top incumbent operators-Airtel, Vodafone India and Idea.

It is expected that Reliance Jio’s new offer would hurt its rivals by a minimum 15-20% fall in data tariffs.

Nitin Soni, director at rating agency Fitch, told ET Jio's decision to keep its free services offer running for nearly seven months is unprecedented, which is bound to continue the bruising impact on incumbents.

"I see the 'continuing Free Jio' effect causing data tariffs to plunge by at least 15-to-20 % over the next 12 months, and Ebitda margins of top telcos falling by at least 150-to-200 bps over the same period,” Soni told ET.

Meanwhile, Airtel's former chief executive Sanjay Kapoor told ET top three incumbent carriers should raise their game and redesign key voice and data plans.

“While Jio has managed to sign up over 50 million customers on the back of free services being offered, one will have to see whether Jio is able to retain them once the free services end,” Merrill Lynch stated.
Add Comment()
Comments ()
X
Sort By:
Be the first one to comment.
We have sent you a verification email. This comment will be published once verification is done.