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Tuesday, 5 September 2017

Reliance Jio turns one: From a disruptive 4G telco to a network leader in one year

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Itmay have been a slow, long year for the telecom industry in India, but Reliance Jio, the latest entrant, will be able to claim the contrary: that in a very short span of time, it has travelled very far. Jio came, disrupted the market and now a  year later, it still continues to do so with the recent launch of the JioPhone, a 4G feature phone for the masses.


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Reliance Jio's journey started off back in December of 2015. Reliance Industries chairman Mukesh Ambani at the Jio introduction event broke the news that the company's Jio 4G network was finally up and running and that lucky employees (numbering over one-lakh plus) were the first customers to take India's first 4G all IP network for a test drive.

From speeds never seen before, to crystal clear voice calls, Jio employees got a taste of India's first truly 4G LTE network. Soon enough, Jio's confidence began to grow, with families of these employees on-boarded on to the beta-testing program. The company wanted to test out its network to fix possible glitches before a wider public roll out.

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Later in January 2016, Reliance Jio began the roll out of its Wi-Fi service. The high-speed Wi-Fi services called Jionet. The service was launched by Andhra Pradesh Chief Minister N Chandrababu Naidu on the occasion of Jio Amaravati Marathon. Back then, Jio's claims were pretty high. According to a PTI report, Reliance claimed that Jio 4G will deliver 10 times higher download speed and 4 times better upload speed compared to others.

Incumbent telcos began to feel the pinch of Jio's presence in the space, especially when Jio signed up with Reliance Communications to increase its spectrum footprint.

Come March 2016, Jio's affordable and budget LYF branded 4G smartphones began to enter the market in preparation for the launch of its 4G services. Back then, the launch was expected to take place in the second half of 2016.

Sadly, the mid-year launch did not take place. Around May of 2016, Reliance announced a Jio referral program. The program allowed beta users to invite 10 friends to experience Jio services. However, there was a catch. While the referral program allowed plenty more users to access the Jio bouquet of services (JioPlay, JioBeats, JioMags, JioNews and so on), news users had to purchase a LYF smartphone to jump on to the same. Getting an invite was a big deal indeed, with invites sent being valid only for 15 days.

A month later, Jio.com went live with the Jio bouquet of apps (MyJio, JioChat, JioPlay, JioOnDemand, JioBeats, JioMags, JioXpressNews, JioDrive, JioJoin, JioMoney and JioSecurity) becoming available on both the App Store (iOS) and Google Play (Android). The services, however, were only accessible by the lucky few who had managed to get on the Jio network through the referral program.

With  and more users vying for a Jio connection, existing operators began to feel the pinch. Vodafone, for example, began slashing its data rates, followed by others in anticipation for the Jio launch.
Reliance soon began opening up the Jio Preview Offer to other devices with 4G bands as well. Beginning with Samsung and LG smartphones, Jio soon hauled in a long list of manufacturers to support its LTE network.

On 1 September, Jio's real journey began with Mukesh Ambani announcing free voice calling, zero roaming charges cheaper tariffs for existing Jio customers. Also announced at the AGM was the Jio Welcome Offer, that offered new customers free data services for four months.

But as with every new disruptive launch, with disruptive tariffs, comes problems with interconnectivity. Ambani made things crystal clear at the AGM, that there were about 5 crore call failures suffered by Jio customers because of interconnectivity issues with existing networks.

On 16 September 2016 Reliance Jio slammed incumbent operators Bharti Airtel, Idea Cellular and Vodafone for allegedly refusing to help their mobile phone users port or switch to the new operator. In a letter to TRAI Chairman R S Sharma, Reliance Jio said Bharti Airtel Ltd, Idea Cellular Ltd and Vodafone India Ltd were perpetrating "illegal and perverse actions" by refusing to enable the porting of mobile number connections.

TRAI Chairman RS Sharma claimed that call failure rates were unacceptable. He added that telecom operators need to comply with regulations on points of interconnects (PoIs). While telcos argued that Jio’s introductory offer was predatory, the TRAI Chairman said there was no reason for the TRAI to intervene in the matter as Jio’s offer prices were under forbearance.
On 22 October, 2016 Jio won its case against the incumbent operators. The Indian telecom regulator slapped heavy penalties on the three telecom players — Bharti Airtel, Vodafone India and Idea Cellular — for not providing sufficient points of interconnections (PoI) to Reliance Jio. TRAI suggested imposing Rs 3,050 crores penalty on Bharti Airtel, Vodafone, and Idea for allegedly denying interconnectivity to newcomer Reliance Jio.
Come December 2016 Jio announced that it had extended its free, data, video and Wi-Fi services for three more months. ‘Jio Happy New Year Offer (“JNO”)’offers subscribers certain special benefits in data, voice, video and the full bouquet of Jio applications and content — all of these services would now be free till 31 March, 2017. At the same time, Ambani also claimed that the company has acquired over 50 million customers in just about three months.

A month later thanks to the new offers, Jio managed to acquire a total of 72.4 million subscribers as of December 2016.
The free services offered by Jio did not go unnoticed by competitors. TRAI, however, gave Jio a clean chit stating that the free promotional offer could not go beyond the stipulated 90 days.


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On 21 February, Mukesh Ambani launched Jio Prime service for the 100 million existing subscribers. All the current Reliance Jio members and the people who would enroll between 1 and 31 March 2017 would be eligible to get the benefits of Jio Prime Membership. For the first time,  the prices for the plans were out with memberships starting from as low as Rs 99 for the first year for existing members who had to pay a flat fee of Rs 303 per month to avail the benefits of the Happy New Year Offer.
With the new plans out, Airtel and Vodafone introduced new plans to retain customers.
Move to March of 2017 and Idea and Vodafone joined hands in a $23 billion deal to stay afloat. The telecom giants would spend about Rs 13,400 crore to integrate their services.
With 72 million paid customers, Reliance Jio decided to extend its Jio Prime offer until 15 April. Along with the extension of the Jio Prime membership offer to 15 April, Ambani also announced a 'Jio Summer Surprise Offer'. This would entitle a Jio Prime subscriber to three months of complimentary services after their first recharge.

Soon enough telecom regulator TRAI recommended Jio to stop its Jio Summer Surprise offer. With that on hold Reliance then put up its Jio Dhan Dhana Dhan offer.
Things were looking up for Jio moving forward with a TRAI report pointing out that the telco had the fastest 4G download speeds in March 2017. Average download speed on Reliance Jio network was 16.48 megabit per second (Mbps) in March against 8.33 Mbps on Idea Cellular's and 7.66 Mbps on Bharti Airtel's network, the monthly report by Trai showed.
As of April 2017, Jio reached a paid subscriber base of 108.9 million users. Reliance Industries revealed plans to spend a further $2.8 bn on its Jio telecom business in the current quarter, taking its investment in the venture to more than $30 bn.

More recently in June, a survey by London-based wireless coverage mapping company OpenSignal revealed that the Jio launch alone attracted 100 million subscribers in the first six months. The move was enough for India to reach the 15th spot in 4G availability worldwide, which is a big deal. Open Signal report stated, “The Jio-inspired 4G revolution in India has sent that country rocketing up our availability charts.” hinting how Jio’s widespread availability and affordable pricing has made adoption easier.
In the recent highlights released by the Telecom Regulatory Authority of India (TRAI) in July, its latest telecom subscription report for the month of May, Reliance Jio turned out be the fastest growing service provider, showing a growth rate of 4.25 percent. Reliance Jio came out on top with a massive 117.34 million with Bharti Airtel at 53.30 million subscribers and Vodafone at 40.43 million subscribers in second and third place respectively.
The July Reliance Industries Limited AGM, saw the announcement of Jio's latest wonder, the JioPhone. The much-rumoured, much talked about, and much-awaited JioPhone "effectively costs Rs zero" as buyers will be able to get the device for a one-time refundable security deposit of Rs 1,500. It is Jio's most affordable, yet practical offering yet, bringing 4G to the masses at the lowest cost possible.
On 24 August 2017, pre-bookings for the JioPhone began. Two days later, the Jio.com website hinted that millions of JioPhones had been booked, with some claiming the number to be around 6 million. Pre-booking were halted for the Linux-powered 4G feature phone.
While it may have been a bumpy ride for Jio and the other telecom operators, it seems that in the end, it was the consumer that benefitted the most out of Jio's disruptive pricing. Like it or hate it, Jio is indeed here to stay and seems to have made plenty of headway in just a single year of its existence.

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