Reliance Jio plans to crank up postpaid dial

Reliance Jio is working on a plan to make a big push in the postpaid mobile market to take on incumbent operators who dominate this segment.

As far as postpaid is concerned, it has a tariff plan, of ~199, which it did not promote and it accounts for less than 1 per cent of its customers.

According to those in the know, it could be bundled with its proposed Android smartphones (it is working with Google), and offer international roaming at lower rates, a priority subscriber identity module (SIM) set-up and services, and features like data sharing and other value-added offers.

A Reliance Jio spokesperson declined to comment on the matter.

Incumbent operators are making

every effort to retain their postpaid customers because they generate high average revenue per user (ARPU) and are loyal to the brand. Also, it is the only

segment in which they do not have competition from Jio because the acquisition cost of wooing postpaid customers from incumbent players, say experts, is high. Last August, Jio, in an annual general meeting, hinted at a new postpaid plus value-added plan for premium customers, but it was not rolled out.

Incumbent players, however, have a high stake in the postpaid business. In the case of Vodafone Idea (Vi), for instance, 7.2 per cent of subscribers were postpaid in the first quarter of 2020-21, while for Bharti Airtel it is 5.2 per cent.

With postpaid ARPU being nearly three times the prepaid one, according to the data from the Telecom Regulatory Authority of India (Trai), it accounts for a stable 5 per cent of the total mobile subscriber base.

Telecom companies say they make up for 15 per cent of the overall telecom mobile revenue. Not only that, in key metros like Delhi and Mumbai, postpaid accounts for a substantial portion of the subscriber base — 21.22 per cent and 16.39 per cent, respectively. Jio has taken on incumbent operators by complaining to Trai that many new tariff plans, such as premium Redx from Vi, violate service rules. The service, which offers 50-per cent faster internet speed, has come under Trai’s scrutiny.

However, according to reports, Vi has filed a revised tariff plan in which the “priority 4G network” offer has been withdrawn. The Jio foray comes at a time when, Trai’s data says, the gap in ARPU between postpaid subscribers and prepaid customers is coming down. In the quarter of March 2019-20 (FY20), postpaid ARPU was 2.9 times higher than prepaid ARPU, according to the data released last week.