Reliance Jio Adds Most Active Users In October Despite Voice Charges
India’s youngest telecom operator added the highest number of active subscribers since its inception despite deciding to start charging customers for voice calls.
Reliance Jio Infocomm Ltd. added 1.44 crore active users in October, according to data compiled by BloombergQuint, taking the number of active users on its network above the industry average of 82.9 percent.
Reliance Industries Ltd.—Reliance Jio’s parent—said on Oct. 9 that it will charge customers 6 paise per minute for voice calls made to other networks to compensate for the call connect fee. That came nearly three years after billionaire Mukesh Ambani promised at the wireless carrier’s launch that voice calls across India will never be charged.
Ambani upended India’s telecom market first with free and then cheaper plans. But Jio and its rivals increased data tariffs in December after the Supreme Court ordered operators to repay thousands of crores in dues. The impact of higher pricing will be evident only when the December data is out—usually released with a lag of two months.
Meanwhile, Bharti Airtel Ltd., added 68 lakh active users in October—for the first time in the past year. The Vodafone Group Plc. and Aditya Birla Group-controlled Vodafone Idea Ltd., however, continued to lose active subscribers for the 18th consecutive month, albeit at a lower rate. The telecom operator’s active subscriber base declined by 7.4 lakh—an 11-month low.
Vodafone Idea has now lost close to 12 crore active users in the last 18 months. That has changed the industry’s pecking order. Reliance Jio is now India’s second-largest operator by active users, while Bharti Airtel is the largest. Vodafone Idea slipped to the third spot for the first time since the merger.
A higher number of subscribers actively using an operator’s services doesn’t necessarily mean improved revenue. At the least, it means the customer is frequently using the service and the risk of losing that user is low. Broadband users—who predominantly use data—generate higher revenue as voice services are almost free in India.
Bharti Airtel also added 50 lakh mobile broadband users in October—the most in the nine months. Vodafone Idea, on the other hand, added 36 lakh users—an 11-month high.
The Sunil Mittal and SingTel-backed Bharti Airtel has been able to add more data users due to its improved network, competitive plans and better customer service. The broadband subscriber addition for Vodafone Idea has been lower, while active user base has been declining which due to deteriorating network quality, possibly due to network integration issues.