Reliance Jio and others lose to Bharti Airtel in adding active subscribers as Indian telecom war intensifies

Reliance Jio

A woman checks her mobile phone as she walks past a mobile store of Reliance Industries’ Jio telecoms unit, in Mumbai, India, July 11, 2017.REUTERS/Shailesh Andrade

At a time when active subscriber base is decreasing for most telecom service providers in India, Bharti Airtel was the only telco that gained 23 million active users over the past year, according to a new report from India Ratings and Research (Ind-Ra) published on Thursday.

The Ind-Ra report also said that Idea Cellular gained 11.9 million active subscribers — measured by peak visitor location register (VLR) — while Vodafone gained 5.1 million active subscribers over the past one year. Both telcos, however, have reported subscriber loss in the past three months.

Meanwhile, the Cellular Operators Association of India (COAI) revealed in its data that Airtel had over 282 million subscribers at September end while Vodafone India was at the second position with over 207 million during the same period. Idea, on the other hand, was ranked third with over 190 million absolute users.

Bharti Airtel

A girl checks her mobile phone as she walks past the Bharti Airtel office building in Gurugram, previously known as Gurgaon, on the outskirts of New Delhi, India April 21, 2016.REUTERS/Adnan Abidi/File Photo

When it comes to Reliance Jio, the new entrant’s subscriber market share was at 13.6 percent at September end while Airtel led the market with 29.8 percent share, followed by Vodafone and Idea with 21.91 percent and 20.09 percent, respectively, according to COAI.

In August, Reliance Jio’s active subscriber base was relatively low at 100 million due to its lower active subscribers at 75 percent. However, the company, which had 133 million subscribers by end of August, continues to gain subscribers steadily (4-5 million per month) despite obvious saturation.

Reliance Jio’s market share gain was “largely explained by the dual SIM phenomenon and rapid loss of market position by the smaller telcos,” the Ind-Ra report said, adding that the company is trying to maintain its momentum through discounted tariffs and cash back offers.

“RJio’s biggest impact has been on data consumption pattern as all its wireless subscribers are by default broadband data subscribers. This has increased not only the absolute number of data subscribers but also its discounted tariffs have increased the data consumption multi-fold,” the report said.

Overall, telecom revenues dropped 2 percent to Rs. 1.9 trillion in the 2017 financial year, mainly due to free pricing by Reliance Jio in the second half of the year and the rest of the industry’s response to the same.

“The industry revenues could revive over 12-18 months period led by RJio increasing its tariffs, exit of smaller telcos and expansion of the data revenue base,” the Ind-Ra report said.


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