Will Reliance Jio overtake Bharti Airtel today to become India’s 2nd largest telecom operator?
By: Prachi Gupta– Published: May 6, 2019. Edited for clarity by Alan J Weissberger, IEEE Techblog Content Manager
The race to become India’s second largest telecom operator between Bharti Airtel and Reliance Jio is still on. With Airtel’s Q4 results due on Monday, it will soon become clear if Mukesh Ambani’s Jio will actually climb the ladder and outshine Sunil Bharti Mittal’s company.
With 29 crore wireless subscribers towards the end of February 2019, Reliance Jio has emerged as a tough competitor to many telecom operators in India. Considering Jio’s growth trend in the previous few quarters, it may even leave behind Vodafone-Idea, dethroning it as the current largest telecom firm in India.
While other telecom operators have mostly maintained a ‘lose’ or ‘barely growing’ trend on the subscriber base, Reliance Jio has been the only telecom which maintained a ‘gain’ streak throughout the year 2018. For the QE Sep-Dec 18, Reliance Jio was the only private telco (along with PSU BSNL) to gain subscribers while both small and large players, including Vodafone-Idea, registered mostly negative growth. Jio had added close to 3 crore subscribers in that quarter, according to TRAI’s Indian Telecom Services Performance Report. In the year 2018, Reliance Jio has continued to add more than 2.5 crore subscribers every quarter.
Reliance Jio’s own reported user base tells a similar story. In its Jan-Mar 2019 quarterly results details, Reliance Jio reported over 30 crore subscribers at the end of March. Bharti Airtel is due to report its March-end user base today, along with its quarterly results.
NOTE: Crore is an Indian term that =ten million; or = 100 lakhs, especially of rupees, units of measurement, or people.
Reliance Jio vs Airtel vs Vodafone Idea: Who will emerge as India’s largest telecom operator?
As of February 2019:
- Vodafone-Idea had over 40 crore users (wireline and wireless combined),
- Bharti Airtel had over 34 crore users.
- Reliance Jio was strong with a little less than 30 crore subscribers (TRAI figures). Vodafone-Idea leads in terms of market share for wireless subscribers with 34.58% share.
- Bharti Airtel’s market share is 28.75%, while Reliance Jio is inching closer with 25.11%.
In terms of wireline market share, BSNL leads with more than half the subscription hold, followed by Bharti Airtel at 18.95%. For broadband services, Reliance Jio topples all other telecom operators with a 54% share in the market.
Update- May 21, 2019: Jio adds 9.4 million customers in March, Airtel, Vodafone-Idea lose
: Reliance Jio has added 9.4 million customers while India’s teledensity has declined 1.82% to 90.11%, from 91.86% in March 2019 with active wireless subscribers reaching 1,021.75 million, the sector regulator in a finding Tuesday said.
Jio has added 9.4 million users in March to take its user base to 307.7 million, while Vodafone Idea and Bharti Airtel lost 14.5 million and 15.1 million customers, respectively, to take their subscriber bases to 394.8 million and 325.2 million during the same period, the Telecom Regulatory Authority of India (Trai) said.
Bharti Airtel had 27.99% subscriber market share, Vodafone Idea 33.98% and Jio had 26.40% market share as of March 2019.
Vodafone Idea’s active use base, or VLR, was 93.27% of its overall subscribers, while Reliance Jio was at 84.04%. The finding revealed that Bharti Airtel has the maximum proportion – of 100.82% – of active wireless subscribers in the month of March 2019.
In the broadband segment, Vodafone Idea had 19.57%, Bharti Airtel 20.35% and Reliance Jio had 54.45% market share as of March this year.
The monthly decline rates of urban and rural subscription stood at 0.90% and 2.98% respectively in March 2019, according to Trai.
The regulator added that in March, 5.30 million subscribers submitted their requests for Mobile Number Portability (MNP), and the cumulative porting requests have increased from 423.11 million in February to 428.40 million at the end of March 2019.
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May 22, 2019: Reliance Jio retains crown as India’s only telecom operator to add mobile subscribers in March
Once again Mukesh Ambani-led telecom operator Reliance Jio has emerged as the only network to add mobile subscriber in a month.
Jio, in the month of March, has added about 9.4 million users, whereas all other telecom operators lost subscribers, according to latest TRAI subscription data.
Vodafone Idea and Bharti Airtel witnessed a downfall in subscribers base by nearly 14.5 million and 15.1 million respectively (29.6 million together). Tata and BSNL subscribers base down by 1 million and 523K.
At the end of March, Jio mobile subscribers base stood at 306.7 million whereas Vodafone Idea and Airtel mobile subscriber base were 394.8 million and 325.1 million respectively, added the data.
India is emerging as the testing and acquisition playground for global consumer technology companies, especially the so-called FAANGs, according to a veteran Internet analyst.
RBC Capital Markets’ Mark Mahaney, who calls himself Wall Street’s “oldest Internet analyst” after covering the sector for more than two decades, said India is now more popular than markets like China because it has the same growth dynamics but with fewer regulations.
As one of the largest economies and most populous countries in the world, India has turned into a testing ground for companies such as Facebook, which has used it to beta-test a payments feature for WhatsApp. Netflix rolled out a mobile plan in India at Rs 199 ($2.80), much cheaper than what it charges for a basic plan elsewhere, and has created original content to capture more market share.
“India does have regulations but it doesn’t seem to be as protectionist as China,” said Mahaney. India has been considering a new law that would require personal data to be stored locally, which could impair the operations of the Internet giants but Mahaney remains confident they can still penetrate the market.
Besides organic growth, acquisitions are another strategy for these companies in India, especially since they are facing more scrutiny back home and in western Europe. “There’s an opportunity to build growth” in Asia, particularly in India, Mahaney said.
Amazon has already tried its hand at deals in the South Asian nation by attempting to acquire Indian ecommerce pioneer Flipkart, before it was snapped up by Walmart last year.
Facebook, Netflix, Amazon and Alphabet can all win big in India, said Mahaney, who has a buy rating on the stocks. “India is less than 5% of Amazon’s total revenues but it has the potential” to get to that level within five years, Mahaney said.
Reliance Jio, the newest entrant in the Indian telecom market, has now become the largest telecom operator in the country in terms of both subscriber base as well as revenue share. This is quite impressive given that the company started operations just three years ago.
As per the data released by Telecom Regulatory Authority of India (TRAI), Jio added 5.6 million new subscribers in November 2019, surpassing all other telecom players. With this, the company’s total user base has now reached to 369.93 million. There however, was a decline in subscriber base growth.
The company has now replaced Vodafone Idea as the India’s largest mobile services provider by subscribers. Jio is now holding 32.04 percent market share, which has increased compared to 30.79 percent share at the end of October.
In November 2019, Vodafone Idea lost 36.41 million subscribers and is left with a market share of 29.12 percent. On the other hand, Bharti Airtel has added 1.65 million new subscribers, taking its total to 327.3 million in the same month. It held a 28.35 percent market share following the increase in its wireless subscriber base.
It’s noteworthy that despite the increase in the number of subscribers by Jio and Airtel, the telecom sector lost 28.81 million users, the biggest decline witnessed by this industry since April 2018.
Since Jio entered the market, the telecom industry in India witnessed shrinking revenue streams, bankruptcy and, finally, consolidation. But, the last three years have been monumental as 4G coverage soared and became a catalyst for the growth of mobile data and new applications and services.
Entry on Jio led to an unprecedented rise in mobile data consumption, with an average user consuming 11 GB of data per month. Many companies either shut shop or were acquired by bigger companies. Thus, the market now witnessed a three-way tussle between Airtel, Vodafone Idea and Jio.
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