Reliance Jio to roll out cheaper products to acquire market share: Fitch Ratings

By April 9th, 2016 AT 9:28 AM

Reliance Jio may roll out much cheaper products to capture the market share from incumbents–Airtel, Vodafone and Idea–as soon as possible, according to Fitch Ratings, which expects the 4G player to launch commercial services in the second half of this year.

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“When they [Jio] launch, their products will be cheaper than what the incumbents are offering right now. That will be their strategy to capture or snatch away the market share from incumbents as soon as possible because it is a crowded market and they will have to launch a better product at a cheaper pricing to force consumers to turn out from the incumbent networks to their network,” Fitch Ratings’ Nitin Soni told ET Now.

Upon the launch of Jio services, the data pricing will decline going forward, affecting the margins of the incumbents, according to the ratings firm.

While the short-term strategy will be focused on acquiring customers with cheap pricing, Soni reckons that Jio will have to raise tariff in the medium term. So hopefully, now they will launch and once they launch, we expect the data pricing to decline going forward, affecting the margins of the incumbents.

According to him, at such cheaper prices, it will be very difficult for Reliance Jio to earn a sufficient return on their investment which is a massive investment of $18-19 billion.

Global financial services firm UBS had earlier said that Jio is likely to soft launch 4G LTE services in the country by the end of this month, while the full commercial offering was expected by December.

Jio’s 4G SIM have been shipped to the retail outlets, however they are not yet available for sale “At present, Jio SIM cards are only available to Reliance employees, post its beta launch in December 2015,” UBS added. UBS said that its speed test on trial SIM cards in Reliance outlets indicate network speed of 18-20 Mbps versus Vodafone’s 4G speed of 8-10 Mbps.

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MartinAtheistDominic Jude D'MelloKiran FernandesJyotirmoy Manna Recent comment authors
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Surya
Surya

Though the coverage checker the my jio app shows my area is under jio coverage but still a manual search on my 4g phone doesnt show jio network…anyone knows why?

Akhil Singhal
Akhil Singhal

do you have a 4g sim inserted in your device ?
there are many handsets(like mine in samsung), wherein if 4G sim is inserted of any operator, then only that slot shows up 4G list when searching manually.

Atheist
Atheist

Either ur device is not compatible wid jio bands.. Or u sometimes need a 4g sim to search.. Or u havnt enabled lte mode.. N last thing possible is dat jio is actually not available in ur area

Surya
Surya

Thanks @ Akhil & Atheist……….I have a samsung galaxy on5 & indeed only after I inserted an Airtel 4G sim that
IND-JIO showed up at manual network search.

Dominic Jude D'Mello
Dominic Jude D'Mello

Rcom says that all CDMA Sims will be,changed to Jio network by 4/5/2016,how far is this true.

Kiran Fernandes
Kiran Fernandes

Yes its true. Rcom is starting 4g on the 4th of May in both Bombay and Rest of Maharashtra, and they will be using Jio 4g network.

Jyotirmoy Manna
Jyotirmoy Manna

How far is it possible that Rcom will give 4g to own customers using Rjio network but Rjio will not give and activate SIM to use their 4G network by their own customers, on a particular date say 4th May?

Atheist
Atheist

Wat about reliance gsm customers? When will we get 4G sims and access to 4G?

Dominic Jude D'Mello
Dominic Jude D'Mello

Any idea as to what handsets a compatible with Rcom 4 g,jio has announced there list of handsets

Atheist
Atheist

same as JIO

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