Reliance Jio Won’t Be Too Keen to Hike Tariffs Amid Less User Additions

Reliance Jio, India’s leading telecom operator, might not be too keen to increase tariffs owing to lower net user additions in the previous quarters. Even though the telco’s tariffs were 7-20% lesser than that of Bharti Airtel, it did not add many users during the October-December period in 2020. The increasing subscribers churn rate is directly impacting the net users’ addition of the telco. This is why the telco is expected to deter from increasing tariffs of its offerings according to brokerage Jefferies. For getting more details on the story, keep reading ahead.

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Reliance Jio’s Decreasing Trend in Net Users Addition

Jio is facing a decreasing trend in net users addition. In the June 2020 quarter, the telco added 10 million net users followed by 7.3 million in the September 2020 quarter, and then 5.2 million in the December 2020 quarter. The subscriber churn rate for the telco increased from 0.46% in June 2020 quarter to 1.69% in the December 2020 quarter.

To counter this situation, analysts believe that Jio will quickly introduce its low-cost Android smartphone in partnership with Google. This move would allow the telco to retain its JioPhone users. It is worth noting that the subscriber churn rate might increase further for the telco as between 8 to 10 million JioPhone contracts are bound to expire this quarter.

The loss by Jio is a gain for the second largest telecom operator of the country, Bharti Airtel. In comparison to Airtel, Jio is adding very few new 4G subscribers. Jio has said that the reason behind fewer users addition is partly COVID-19 pandemic and partly the ‘malicious and motivated campaigns’ against the telco in some parts of the country.