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EFFECT OF JIO

EFFECT OF JIO
ON INDIAN TELECOM INDUSTRY
ABOUT
• Reliance Jio officially launched its commercial operations and it has
drastically changed the telecom sector with its free voice calls and
cheap 4G services that changed the way Indian users consumed
data. Free for the first six months after launch, the company’s 4G
data services provided consumers the option to watch more online
videos and other content than ever before, something that became
apparent when India jumped ahead of the US and China to take the
position of world’s biggest consumer of mobile data. Eventually the
company’s services did become paid, but that did not stop the Jio
juggernaut – primarily because of the ultra-low tariff the company
levied for its data – as consumers switched to its Jio Prime
subscription service en masse. Of course, the competition matched
Jio’s offers too, bringing in cheaper plans that provided bundled
calls and much more data than they were providing before.
Here’s a look at 10 ways the telecom
industry changed after Jio’s entry
• Vodafone, Idea Cellular merged
• Helped ease the way for online streaming
services
• Ultra-cheap data
• Increased consumption of online content
• Free voice calls
• Proliferation of 4G smartphones
• Faster mobile data
• The death of 3G
• A record in user acquisition
• Improved broadband Internet availability
• Reliance Jio now ahead of Airtel, Vodafone, Idea
in earning user revenue.
• Jio earned Rs 300 average revenue per user since
it ended free offers on March 31 2K16, study
says.
• A report in The Economic Times cites a study
conducted by Kleiner Perkins Caufield & Byers
that says "Reliance Jio’s ARPU grew to $4.70 or Rs
300 after the Mumbai-based telco ended freebies
in March 2K16.
EFFECT ON VODAFONE
• Vodafone maintained service revenue at INR 42,956 crores
in FY17 despite aggressive new operator launch
• Strong customer additions and growth in data revenues
helped capture market share
• EBITDA at INR 11,784 crores in FY17; a healthy EBITDA
margin of 27.3%
• Operating Free Cash Flow (OFCF) at INR 2,992 crores in
FY17;
• Sustained and prioritized capital investments of INR 8,311
crores in FY17; (Capex intensity of 19.3%) driven by
significant investments in new broadband site roll-out to
deliver superior customer experience and growth in key
focus areas
• Data (Browsing) revenue at INR 8,467 crores in FY17,
5% growth YoY
• 66.9 million data users, of which 43.5million use >1MB
• Added 10 million broadband users during the year to
close at 37.7 million (Q4FY17) 3G/4G subscribers
• Data usage exploding and usage/sub (for users >1MB)
at 970 MB
• Data ARPU (for users > 1MB) at INR 140 in Q4 FY17 vs
INR 160 in Q4 FY16 due to free data offer by new
entrant
• Vodafone’s M-Pesa also effected by Jio money.
EFFECT ON BSNL
• During FY 2013-14, it posted overall revenues of
Rs 27,996 crore; and a net loss of Rs 7019 crore.
• During FY 2014-15, overall revenues increased to
Rs 28,645, while net loss widened to Rs 8234
crore.
• Opening balance of borrowings stood at Rs.
6384.9051 crore as on 1.4.2015. During the year
under review, your company borrowed
Rs.8301.6202 crore and repaid an amount of
Rs.6803.7013 crore. The loan balance as on
31.3.2016 stood at Rs.7882.8150 crore.
• During the financial year 2016-17, Your
Company repaid Rs.2836.7115 Crores of Short
Term Loans; and, Rs.1828.6548 Crores of Long
Term Loan secured by floating charge on the
moveable assets. Outstanding loan amount
stood at Rs.3217.4487 Crores, as on
31.8.2016.
PLANS & AGREEMENTS
• BSNL ramps up broadband capacity, rolls out
new 3G offers
• BSNL recently launched unlimited 3G internet
pack for Rs 1099.
• BSNL signed 2G intra-circle roaming (ICR)
agreement Vodafone to use each other’s
network assets and expand 2G connectivity
across the country in all of their circles.
EFFECT ON AIRTEL
• Bharti Airtel Ltd’s profit plunged 77%, its fourth
straight quarterly decline, as ultra-cheap tariffs
offered by new entrant Reliance Jio Infocomm
Ltd, backed by India’s richest man Mukesh
Ambani, took a toll on telecom operators.
• Airtel’s net profit declined to Rs343 crore in the
quarter ended 30 September from Rs1,461 crore
a year earlier, the company said on Tuesday. That
missed the Rs351.3 crore profit estimate of 16
analysts surveyed by Bloomberg.
PLANS
• Before jio- Plan 999
1GB 4G data
Days-28
• After jio-Rs-448
Days-81
Per day 1GB data plan
. 516 milion
CONCLUSION
• After the sudden entry of jio on Indian
telecom market people are enjoying more
data than they were.
• Government Suffers huge tax loss Due to Jio’s
Free data plan.

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