Reliance Jio

Abstract

The launch of Jio is likely to transform the Indian telecom sector but at the same time put pressure on
multiple fronts on the current telecom operator such as Bharti Airtel, Idea & Vodafone. The entrance of
the jio has brought a stormy revolution in the Telecom market and Jio has emerged into a brand new
world of innovations and up gradation. This article discusses the features of the jio and the edge it
would have over its rivals once operational. The objective of this research paper is to find whether the
company will become a Star or will remain a question mark.

Review of Literature

Jio is the telecommunication company owned by Reliance Ltd. It emerges one of the fastest growing
telecom operator in India as data published in a review of literature Jai Bhatia Economic & Political
Weekly OCTOBER 8, 2016 vol lI no 41. Jio came up with a vision to generate huge revenue by providing
quality service at a cheaper rate using the latest technology. Initially, its growth i s high. In the Indian
market, it is the first mover advantage for Jio with a biggest 4G network coverage infrastructure all
across 22 telecom circles in India. None of its competitors is having such biggest infrastructure for 4G
infrastructure.
As we saw in the year 2012-13, India is 150th in the world in mobile broadband penetration as well as
quality. And Jio has really been conceived to change this position," the Indian billionaire said.
Jai Bhatia, Advait Rao Palepu in their paper Reliance, Predatory pricing or predatory behavior ( OCTOBER 8, 2016)
says that Jio can also be understood by Predatory Pricing Strategy to some extent In the beginning, Jio is

also followed the same strategy which made their competitors think about their pricing process they all
have tried to reduce and match with the pricing level of Jio price.
According to the data published by www.paulasset.com, reliance Jio is good for Indian market because
it is giving best quality on lower price. The data also explains that presently Jios data traffic is higher
(TRAI Data) compared to its competitors. Jio is also threatening As it is expected that it will kill more
than 30 businesses within next 5 to 10 years, According to poulasset. Jio will acquire and will hold a
major number of market shares in the following areas.
Mobile (Local/STD + SMS), MOBILE DATA (3G/4G), CABLE TV/ D2H, MAGAZINE/NEWSPAPERS, CLOUD
STORAGE, MOVIE DOWNLOAD/ WATCHING, NEWS READING APPS, MOBILE WALLETS / QUICK PAY &
OTHERS
Jio has already started giving substitution for the above at one place, i.e. Jio TV, Jio Music, Jio Wallet, Jio
Drive Etc
According to information published by gadget.ndtv.com It is very difficult to compete with Jio as they
have invested 150,000 Crores rupee during 2010 to 2016 for developing the infrastructure without
having any profit. It is not easy to build such big sector in India in one go because it requires a huge
amount and long period of time. Reliance is always ready to deal with any such startup which can
threaten Jio. Existing competitors like Airtel, Vodafone is already suffering from a huge debt so its not
easy for them to invest that much huge amount in a short period of time.
Nearly 25 million cellphones are using Jio Sim even before its commercial launch! Reliance Jio is making
headlines with its easy on pocket data packs and lifetime free calling. Never in the history of telecom has
anybody witnessed a player seize the market in a weeks time by distributing Sim cards with the
unlimited free internet.
According to an article published in the myvoice.opindia.com Analysts doubt the strategy of Reliance
by siting that with its schemes. Jio will attract low-quality customers who will jump to other networks
once the freebies end. But Reliance doesnt believe so. It is offering free 4G data which me ans itll
occupy the primary Sim slot in the smartphones 4G phones. Also, customers will switch to Jio from their
broadband or the Wi-Fi services and possibly will stick to it even after the promotion period ends. In
addition to that, it is offering free calling, so it is aware people will be using the number for calling
purposes for the next three months. Three months is a sufficient time span for people to experience the
super-fast speed and the quality services and permanently transfer to the network. Now assume that Jio
reaches 75% of its planned subscriber base of 100 million. So by the end of the year, Reliance ends up
with 75 million subscriber base. Indias total 4G user number is believed to touch the mark of 143 million
by this year end. So within 3 months of its official launch, Jio would have acquired more than 50% of the
market share. Even if many subscribers leave the service of Jio, still Reliance would be left with
significant market share.

The analytical data shows that it has captured maximum no. of the market shares within the shortest
period of time. It can also be concluded that the people who are having the Jio service at present,
among them 70 to 80 % of the users are happy with its service. This number is higher in the rural areas
and lesser in the urban areas. By the end of 2017, it is expected that there will be 30 to 40 crore
subscribers or more than that. The free app which is given today will be no longer be free, later on, the
consumer will be spending around 6 to 10 thousand in a year. It will generate huge revenue. "By 2017
end, we would cover 90% and by 2018, all of India will be covered by this digital infrastructure," Ambani
said.

According to Times Of India (Feb 22, 2016,) As we saw in the year 2012-13, India is 150th in the world
in mobile broadband penetration as well as quality. And Jio has really been conceived to change this
position," the Indian billionaire said.

Conclusion

Using various data from the market and subscription base figures as a method to understand market
dominance, R. Jio cannot be specified as a dominant operator but it can be specified as the initially
fastest growing Telecom operator. The data shows that it has captured maximum no. of the market
shares within the shortest period of time.

The people who are having the Jio service at present, among them 70 to 80 % of the users are happy
with its service. This number is higher in the rural areas and lesser in the urban areas.
Based on the BCG Matrix, we can say that Jio is a question mark for the reliance Ltd. The data shows that
they are pumping the huge amount of money and at present, it is not giving a bit of profit to them at
present. It is expected in the future that The Jio will end up generating a huge amount of revenue from
the consumers depends on upon the policy and steps will be taken by the Jio officials.
This is the only company which is holding 4G infrastructure in all 22 telecom circle, By the end of 2017, it
is expected that there will be 30 to 40 crore subscribers or more than that. The free app which is given
today will be no longer be free, later on, the consumer will be spending around 6 to 10 thousand in a
year. It will generate huge revenue.
Bibliography
http://gadgets.ndtv.com/telecom/news/vodafone-announces-free-incoming-calls-on-national-
roaming-starting-this-diwali-1477284
http://gadgets.ndtv.com/telecom/news/reliance-jio-4g-speed-slowest-in-india-shows-trai-data-
jio-blames-daily-data-limit-of-welcome-offer-1477264
http://indianexpress.com/article/technology/opinion-technology/reliance-jio-4g-launch-digital-
india-mukesh-ambani-data-explosion-3009188/
http://indianexpress.com/article/technology/tech-news-technology/reliance-jio-4g-wait-for-
three-weeks-heres-how-to-get-sim-4g-preview-free-3015877/
http://gadgets.ndtv.com/mobiles/news/lyf-f1-launched-in-india-price-release-date-
specifications-and-more-1477217
https://www.paulasset.com/articles/reliance-jio-will-kill-30-businesses/
http://myvoice.opindia.com/2016/09/strategy-of-reliance-jio-in-3-points/
http://www.ciim.in/reliance-jios-marketing-strategy-case-study
http://indianexpress.com/article/technology/tech-news-technology/reliance-jio-sim-how-to-
get-speed-price-lyf-phone-2908823/
Many others source like
The Hindu, Economic Times, Times of India, By interviewing some friend who are living in the
rural and urban areas, Personal Experience, Various other webpages and sources.

Anand, N (2016): Aircel Bets Big on Data Plans for Growth, 28 June, Hindu, http://www.thehindu.
com/business/Industry/aircel-bets-b ig-ondata- plans-for-growth/articl e 878 4 551.ece.

TRAI (2016a): Consultation Paper on Review of Interconnection Usage Charges, Consultation Paper
No 17/2016, Telecom Regulatory Authority of India, New Delhi

Hindu (2016): With 220 mn Users, India Is Now Worlds Second-biggest Smartphone Market, 3
February, http://www.thehindu.com/news/c it i es/mumbai/business/with-2 2 0 mn-users-in dia- is-now-
worlds-seco n dbiggest-smartphonemarket/article8186543.ece.