Jio's adjusted gross revenue share went up by 7 percentage points in Q2FY18-19 over the previous quarter in the circles of the C category.
According to JP Morgan, it seems that Jio is willing to go for the jugular in chasing market share if this hurts some of its standing rivals like Vodafone and Idea to a point from where they find it difficult to fight back.
When on October 24, the Supreme Court, on a petition moved by the government, ordered payment of past dues according to its new definition of AGR, the country's second-biggest carrier Vodafone-Idea Ltd warned of shut down if no relief is given. The total dues for the industry ran into a whopping Rs 1.47 lakh crore. For an industry that has come from 7-8 operators to just three private players and state-owned fourth operator, the warning by Vodafone-Idea sounded like a death knell.
Attempts are being made to balance the need for health of the sector, consumer interest while complying with the Supreme Court order on statutory dues.
Bharti Airtel chairman Sunil Mittal on Thursday said tariffs need to go up amid "tremendous stress" in the telecom sector, and Airtel will not hesitate to raise prices, but it will not do so unilaterally. The comments by the telecom czar came at a time when Airtel's rival Vodafone Idea has approached the government for a one-year moratorium on payment of spectrum instalment of over Rs 8,200 crore - due in April 2022. Cash-strapped VIL has told the telecom department that while it is working on raising new funding for the last six months, "investors are not willing to invest in the company because they believe that unless there is a significant improvement in consumer tariffs, the health of the industry will not recover and they will incur a loss on their investment".
Providing services like broadband connectivity, cable TV, enterprise solutions, and payment wallets is the need of the hour for telcos, and a second wave of consolidation is upon the industry, a rating agency said on Tuesday. India Ratings and Research said the sector, which was battered following the aggressive entry of Reliance Jio, will continue showing signs of recovery amid conducive regulatory environment and maintained a "stable" outlook for the industry in FY22. The second round of consolidation (Consolidation 2.0) is kicking-in in the industry, which will bring a transformation in the business models of telecom companies, leading to the evolution of incumbents from the providers of traditional voice-only services to complete digital solutions for households, it said.
Vodafone Idea's net worth (or shareholders' equity) was down 73 per cent year-on-year to around Rs 17,600 crore at the end of the December 2019 quarter after the company reported a net loss of around Rs 6,400 crore during the quarter. Cumulatively, the company has lost nearly Rs 45,000 crore in the last four quarters, eroding its net worth to its lowest level in three-year. Analysts said a such a low level of net worth, coupled with continuing losses in operations, ruled out the possibility of the company getting fresh loans from lenders to fund its adjusted gross revenue (AGR) dues of Rs 54,000 crore.
Reliance Jio saw fall in speeds from 7.2 mbps in September to 6 mbps in October, according to CLSA report.
Indian telecom operators have surpassed the three- year 5G network rollout target given to them within six months and now the government is making efforts to enhance adoption of 5G applications across various key segments, a senior government official said in Barcelona. Department of Telecom Additional Secretary VL Kantha Rao told PTI at "India Evening" event on the sidelines of Mobile World Congress 2023 that the government has hosted over 50 companies at the India pavilion and the delegation is here to showcase indigenously-developed 4G and 5G technology stack. "When the spectrum was allocated to telecom service providers for 5G rollout, we gave a minimum rollout obligation saying that within one year they have to cover a few cities within three years, a few towns and so on and so forth.
Telecom operator Vodafone has been the top gainer of customers through mobile number portability facility while Reliance Communications is the biggest loser.
Jio is in a neck and neck battle with Airtel, which added a similar number of subscribers as Jio in the 15 months from February 2017 to April 2018
The move comes against the backdrop of the US and some of its allies banning the purchase of Chinese telecom gear over security concerns and pressuring other countries to follow suit.
Commercial 5G services will be rolled out in 13 cities in India, including the metropolises, in 2022, the Department of Telecommunications (DoT) said in a statement on Monday. These cities are Delhi, Gurugram, Mumbai, Pune, Chennai, Kolkata, Bengaluru, Hyderabad, Chandigarh, Lucknow, Ahmedabad, Gandhinagar, and Jamnagar. "These metros and big cities would be the first places for the launch of 5G services in the country next year," the DoT said.
After initial success, data use is stagnating and getting consumers to spend additional money for high-speed internet is proving to be difficult for telcos.
While smart boys like the Ruias of Essar, Ajay Piramal, Max India promoter Analjit Singh laughed all the way to the bank, the Tatas, Anil Ambani, Malaysian tycoon T Ananda Krishna of Maxis (which invested in Aircel), Sistema, and Norway's Telenor burnt their fingers, notes Surajeet Das Gupta.
Tata Teleservices has announced plans to launch 3G services by Diwali, while Vodafone has said it will launch the services by early 2011.
The Mukesh Ambani-owned company had complained to Trai about incumbents offering segmented offers to different customers
Vodafone Idea, which reported a loss of Rs 6,439 crore in the December quarter, said it had received letters from the department of telecommunications (DoT) directing immediate payment of dues amounting to Rs 54,000 crores after the SC judgment. "The company is currently assessing the amount that it will be able to pay to DoT towards the dues calculated based on AGR, as interpreted by the Supreme Court in its order dated October 24, 2019. The company proposes to pay the amount so assessed in the next few days," it stated.
Apple's decision to slash its entry-level iPhone (8 GB version) in the US market will not trickle down to India anytime soon.
During a hearing before the Monopolies and Restrictive Trade Practices Commission (MRTPC) last month Bharti Airtel, Vodafone Essar, Reliance Communications, Tata Teleservices, and government-run BSNL and MTNL agreed to submit the undertaking.
Kumar Mangalam Birla will be the non-executive chairman and Balesh Sharma the new CEO of the merged entity, which will remain listed.
Analysts have pointed out that with the dues arising out of the SC judgment there could soon be only two private telcos in the country, and not three - Reliance Jio, Bharti Airtel and Vodafone Idea - as now.
Experts say going ahead data price will fall further due to competition
Supreme Court had on October 24 upheld government contention that non-core revenue in telecoms groups should be included in adjusted gross revenue. According to DoT's calculations, Bharti Airtel faces a liability of around Rs 42,000 crore after including licence fees and spectrum usage charges while Vodafone-Idea may have to pay about Rs 40,000 crore.
The DoT estimates that it will receive Rs 29,524 cr in revenue from the telecom industry in FY18, which is 38% less than the Budget revenue target of Rs 47,300 cr for FY18
Companies have activated a comprehensive pandemic response plan with requisite risk mitigation protocols for keeping networks working as telecom is an essential service.
Bharti Airtel and Vodafone, India's leading cellular service providers, in collaboration with Research In Motion, on Friday launched the new BlackBerry Pearl 8110 smartphone with built-in global positioning system in the Indian market.
Consumers will now have to pay up to 30 per cent extra for data services as leading telecom players Bharti Airtel and Vodafone are hiking tariffs and others may soon follow suit.
The petitioner said the companies were increasing the prices just to earn huge profit. Companies like Bharti Airtel had posted an annual profit of more than 90 per cent, the NGO said.
Doha-based Qatar Foundation Endowment has bought five per cent stake for $1.18 billion in Bharti Airtel.
Bharti Airtel has paid Rs 11,374.7 cr while upfront amount due from it was Rs 7,832.20 cr
The Cellular Operators Association of India (COAI) has bluntly told the government there is no reason for its members to roll out 5G networks as they will be unviable if 'captive private wireless networks' are allowed to be run by enterprises. The COAI, which has Bharti Airtel, Reliance Jio and Vodafone Idea as its key members, has written to Communications Minister Ashwini Vaishnaw saying there is 'no business case for the roll out of 5G networks'. Permitting such captive networks will 'diminish the revenue so much that there will be no viable business case left for the telecom service providers and there will not remain any need for 5G network roll out by telecom service providers (TSPs)'.
In big bang reforms, the Union Cabinet on Wednesday approved a relief package for the telecom sector that includes a four-year moratorium on payment of statutory dues by telecom companies as well as allowing 100 per cent foreign investment through the automatic route. Briefing reporters on the decisions taken by the Cabinet, Telecom Minister Ashwini Vaishnav said nine structural reforms for the telecom sector were approved. The definition of AGR, which had been a major reason for the stress in the sector, has been rationalised by excluding non-telecom revenue of telecom companies.
Jio to charge users 6 paisa/min for voice calls made to rival phone networks. However, these charges are not applicable on calls made by Jio users to other Jio phones and to landline phones and calls made using WhatsApp, FaceTime and other such platforms.
India's telecom sector has been through dizzying peaks, troughs, policy U-turns, court battles, brutal competition, and daily controversies. India could go back to a private sector duopoly with just Reliance Jio and Bharti Airtel surviving the mayhem. The third player, Vodafone Idea, could be history.
'If you are going to have only a handful of telecom players on whom the entire dream of Digital India rests, it's important they are financially sustainable.'
DoT's proposal to impact many, including Vodafone
Govt says there is enough spectrum, telcos differ
This is the last lot of payments that telcos will make towards deferred spectrum liabilities, as the Union Cabinet had late last year approved a two-year moratorium on such spectrum payment dues.
Analysts said even though the Indian economy is expected to slow down to 7.2 per cent in fiscal 2020, it is still the best bet for investment for foreign investors.
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