Jio’s Subscriber Base to Surpass 100 Million by March 2017 as per Fitch Ratings

The wave of technology has impacted India like never before, mainly because of 4G. Although 4G services were available, they were mainly accessible to only a few because of the high cost. However, Mukesh Ambani led Reliance Jio set an example by becoming one of the first network carriers to offer the high-speed 4G services to millions across the country at affordable rates.

Jio’s expanding user base

The telecom operator received a major boost to its subscriber base when it launched the welcome offer that allowed customers to access free data and app services for three months. Although this initial offer will now come to an end, the free data and app services will be continued in the recently devised Jio Happy New Year Offer. As per this offer, customers can enjoy free data and app benefits till the end of March 2017.

Nitin Soni’s views on Jio’s performance

With respect to Jio’s growing customer base, The Director of Fitch Ratings, Nitin Soni stated that the telecom operator’s marketing strategy has been effective in helping it garner a subscriber base crossing 52 million. In the interview given to BTVi, Soni explained that through the Jio happy New Year Offer, Jio may even manage to secure 100 million subscribers towards the end of March. Ever since Jio’s launch, it has been rapidly drawing customers through its smart promotional offers. Nitin Soni also added that post the free offers, customers may most likely opt for Jio because of its affordable tariff rates. He said that since Jio is expected to have data plans, which are more attractive than those offered by incumbent operators, there is a high chance that customers will choose it over other carrier networks. He further stated that if Jio goes on to launch other offers in the future, incumbent operators may have to revise their tariff rates so that they do not lose out on their existing customers.

Competition most likely to result in consolidation

Nitin Soni also revealed his opinions on consolidation of telecom companies. According to him, Jio’s foray has created a lot of competition because of which there could be consolidation between telecom companies in the future. This could most likely happen if weaker operators are looking to strengthen their position in the industry. He believes that weaker companies could resort to merger and acquisition (M&A) activities to avert the negative impact that the entry of new telecom operators could have on them. He made a reference to one of the telecom operators in India stating that since it did not have pan-India spectrum coverage, it would benefit by implementing M&A activities.

He concluded by stating that data tariff rates are most likely to drop by 15 to 20 percent because of Jio’s entry into the market. According to him, the affordable services of Jio have created intense competition in the industry.

The telecom operator’s future plans include launching a range of 4G-compatible feature phones to target a wider range of audience. This move is expected to help it increase its customer base further.

Summary

Reliance Jio is expected to garner around 100 million customers by the end of March 2017, according to the Director of Fitch Ratings, Nitin Soni.

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