Reliance Jio, the leading telecom operator in India, has taken a significant step that is expected to set a trend for the entire wireless market in the country. The company has announced an increase in tariffs, with some plans seeing a rise of more than 20%.
Effective July 3, Jio’s new pricing structure includes a hike in prices for various plans. For example, the entry-level plan offering 2GB of data and unlimited calls will now cost Rs 189, up from Rs 155. Similarly, a plan with 1GB of daily data usage will increase from Rs 209 to Rs 249. Jio, a part of India’s Reliance Industries, is also adjusting prices for its two-month, three-month, annual, postpaid, and data add-on plans.
In a statement, Akash Ambani, Chairman of Reliance Jio, emphasized that this move is geared towards driving industry innovation and sustainable growth through investments in 5G and AI technology.
Reliance Jio, Bharti Airtel, Vodafone-Idea, and BSNL-MTNL are the major players in the Indian telecom market. Jio currently holds over 40% of the market share, with Airtel following closely at 33.1% as of April.
Industry analysts have been anticipating a significant shift in pricing strategy, with forecasts predicting a 15-25% increase to stabilize and boost average revenue per user (ARPU).
This move highlights the telecom sector’s transition towards monetization as they near the completion of their 5G coverage rollouts. Indian operators have invested heavily in 5G airwaves, exceeding $20 billion, and are exploring new avenues to generate revenue. Last year, there were discussions about tech firms compensating telecom companies for network usage.
Despite the price hike, Indian consumers are likely to accept the changes due to the lack of alternatives and the appealing data offerings, as noted by Bank of America in an earlier report.