Jio likely to continue with slashed prices to gain maximum subscribers

Reliance Jio Infocomm is most likely to continue with its pricing strategy of slashed prices and sharp discounts over the next 12-18 months, so that it can gain about 15% of India's wireless subscribers, up from its existing base that has 6% of such subscribers.

This move will most definitely prove to be daunting for its rivals, like Bharti Airtel, Idea Cellular and Vodafone, pressurising their average revenue per user (ARPU).

Also read: Airtel and Vodafone to keep price war on to counter Jio

These telecom companies are already facing tough times because of Jio, having their ARPU capped at about Rs 300.

It was in March that Jio had set a target of capturing 50% market share by 2020. After its free services offer ended on March 31st, Jio has seen a dip in the rate of subscriber addition, which has prompted the telco to maintain its aggressive pricing.

After it started services on September 5th, the company reached the 100 million user mark in the first 170 days, having added consumers at an average of 600,000 a day. This resulted in Jio getting a subscriber base of 109 million by March 31st.

Also read: Reliance Jio submits Dhan Dhana Dhan tariffs with TRAI

As per a report from Nomura, Jio’s rate of customer additions dipped because it had already reached a majority of almost 134 million available 4G phones in India by March 31.