Mukesh Ambani Has A New Year Gift For Reliance Jio Customers
A customer provides a finger print scan while connecting a mobile phone to the carrier Reliance Jio, the mobile network of Reliance Industries Ltd. (Photographer: Dhiraj Singh/Bloomberg)  

Mukesh Ambani Has A New Year Gift For Reliance Jio Customers


Mukesh Ambani-promoted Reliance Jio Infocomm Ltd. will extend free voice calling, video, data and the full bouquet of Jio applications absolutely free for users until March 31, 2017.

Any customer purchasing a Jio SIM after December 4 will be enrolled under the ‘Jio Happy New Year’ offer, which will be valid till March 31, 2017, Ambani said in a live stream while addressing customers and employees. The existing 52 million customers of the ‘Jio Welcome Offer’ will transition to the Happy New offer automatically on January 1.

Reliance Jio’s services debuted on September 5 this year and were initially meant to be free until December.

While the Jio Welcome Offer provides unlimited data, there is an fair usage policy (FUP) limit of 4GB per day – following which browsing speeds are reduced to 128Kbps. To fight congestion, Jio customers on the “Happy New Year” offer will have an FUP of 1GB per day.

While 80 percent of the users are still consuming less than 1GB of data every day, 20 percent are using data disproportionately, Reliance Jio said in a media statement.

This step has been taken to ensure that all the Jio users get superior data experience. 
Reliance Jio Statement
Mukesh Ambani Has A New Year Gift For Reliance Jio Customers

Reliance Jio will now fully support mobile number portability, Ambani added.

Digital Push For Merchants

Reliance Jio also announced the launch of Jio Money Merchants Solution in an bid to support Prime Minister Narendra Modi's demonetisation move. Merchants can download this app starting December 5.

Jio Money is an existing digital payments and wallet service provided by Reliance Jio. The service will now be extended to merchants who can receive payments from their customers through the application. The target is to have at least 10 million merchants on the platform, said Mukesh Ambani.

This will enable digital transactions of all types, whether they be at mandis, small shops, restaurants, Railway ticket counters, for bus and mass transit and even for person-to-person money transfers.  
Reliance Jio Statement

Aadhaar-based micro-ATMs will also be launched to help facilitate Jio Money. The target is to have at least 10 million merchants on the platform, Ambani said.

Speed Of Growth Impressive, Data Speeds Not So Much

Reliance Jio has added 52 million subscribers in the last three months. Ambani said the company’s growth in the first three months has been faster than that of Whatsapp, Facebook and Skype. In contrast, India largest telecom Airtel took 12 years to reach the same mark, according to a report by wire agency PTI.

On an average, Reliance Jio has been signing up 0.6 million customers daily.

Jio customers, according to Ambani, are using 25 times more data than an average Indian broadband user. He also addressed the issue of inconsistent data speeds.

While 92 percent of our base stations, and customers, have been experiencing consistently high data speeds, we are not satisfied. We are working to de-congest these 8 percent towers, so that impacted customers go back to experiencing true-4G speeds.
Mukesh Ambani, CMD, Reliance Industries

Reiterating the issue of call drops, Ambani said incumbent telecom operators haven't offered their full support and customers have faced difficulties in making voice calls to users of other telecom services. This, despite directions from the telecom regulator and the government asking incumbents to to provide adequate points of interconnection to Reliance Jio.

The benefits of Jio’s superior voice technology have been denied to Indian customers due to such anti-competitive behavior of incumbent operators.  
Mukesh Ambani, CMD, Reliance Industries
Mukesh Ambani Has A New Year Gift For Reliance Jio Customers

Financial Impact

The extension of offers till March 31 will not impact the company’s financials as the company will capitalise its losses. Global financial major Morgan Stanley said in an earlier report that while earnings will remain unaffected in the long term, it expects a 10 percent upside to earnings for financial year 2016-17 if the commercial launch gets delayed.

Assuming Jio delays the commercial launch, there could be 10 percent upside to our FY17 consolidated numbers. However, this would not affect our longer-term numbers.
Morgan Stanley Report

The extension of free services might not augur well for Reliance Jio’s competitors like Bharti Airtel, Idea and Vodafone as it would put further pressure on data revenue, at least four analysts from various domestic brokerages told BloombergQuint.

The financial impact can only be assessed after the December quarter numbers, they added. The July-September quarter earnings did not reflect the impact of Reliance Jio’s freebies as the company launched its services only from September 5.

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