Ahead of Vodafone-Idea’s proposed merger plan, billionaire Mukesh Ambani’s on Tuesday said its telecom unit Reliance Jio would begin charging for data services from April but the company would give a slew of steep discounts for one year more to over its 100 million customers who have come on board within six months of its launch. While local voice calls, STD and roaming will continue to be free, he promised to match the best offers of rival telecom companies and add 20 per cent more data from April 1.
The announcement comes at a time when Vodafone and Idea are considering a merger to create a player bigger than the market leader, Bharti Airtel. In a bid to face steep competition, the incumbents also challenged Jio’s promotional scheme before telecom regulator Trai, saying free services beyond 90- days were a violation of rules.
Post Reliance Jio annoucement Cellular operators’ association COAI expressed relief that the newcomer has announced “price points” for data services post April 1, which although “aggressive” will not bleed the industry.
The Cellular Operators Association of India (COAI) said the pricing along with customer experience determined by a telecom network’s ability to take data traffic load will differentiate the winners from losers going forward.
“The price points and tariffs announced by RJio are good news for the consumer. The industry is pleased to see the commencement of paid services as the market place will now become the place where consumer choice and preference will be revealed,” COAI Director General Rajan S Mathews .
In a speech broadcast live from the company’s social media accounts, Ambani said Jio has added 100 million subscribers in 170 days since launch in September last year and the company plans to extend the network to cover 99 per cent of population by this year-end. “For 170 days, Jio has added on average nearly 7 customers on its network every single second of every single day. This is an unprecedented level of acceptance for any technology company anywhere in the world,” he said.
Jio, which marked Ambani’s re-entry in telecom space after a decade with free voice calls for life and free data for a promotional period that was extended until March 31, will offer existing users unlimited services for a year at a monthly charge of Rs 303 and one-time membership fee of Rs 99.
While shares of Reliance Industries, the parent firm of Jio, rose 1.36 per cent to close at Rs 1,088.25 on BSE, rival Bharti Airtel tanked 3.9 per cent to close at Rs 362.95. Idea Cellular fell 0.4 per cent to Rs 108.30.
“Jio launched its services on September 5 of last year. Today, just 170 days later, Jio has crossed the 100 million customer mark on its 4G lTE, all-IP wireless broadband network,” Ambani said.
After end of its Happy New Year Offer, which was kind of an extension of the initial promotional offer of free voice and data to attract customers, Jio will introduce tariff plans from April 1. “All domestic calls to any network including STD and roaming will continue to be free.
For data, Jio will not only match the highest selling tariffs of each of the other leading Indian telecom operators but also provide 20 per cent more data in each of these plans,” said Ambani.
For the existing 100-million-plus users, Ambani announced Jio Prime Membership programme wherein customers can enroll by paying one-time fee of Rs 99 and continue to get the existing benefits till March 2018 at ‘a rock-bottom introductory price of only Rs 303 per month’.
“With 200 crore minutes of voice and video calls, more than 100 crore GB or 3.3 crore GB a day of data has been consumed on the Jio network, India is now number one country in the world for mobile data usage,” he said adding that data usage on Jio matches almost the usage in US and nearly half more than all of China.
“A significant portion of this data is consumed as video and Jio carries nearly 5.5 crore hours of video daily on its network. This makes Jio one of the largest mobile video networks globally,” he added.
Ambani said Jio has more than double the number of 4G base stations of all the other Indian operators put together. “And we are making our network better, faster and stronger with each passing day. In the coming months, we will more than double our data capacity and this means even better quality for our customers,” he said, adding that by 2017-end the Jio network will be present in nearly all the cities, towns and villages of India, covering 99 per cent of population.