Reliance Jio Infocomm has garnered nearly 20% of the telecom revenue market share (RMS) as of March 2018. The report by Telecom Regulatory Authority of India (TRAI) states that Bharti Airtel leads the telecom market by having a 32% revenue market share, followed by Vodafone whose revenue market share is just a pinch above Jio’s with 21% of the net.
Barely 21 months since it started its operations, Reliance Jio has managed to get past Idea Cellular whose revenue market share as of March 2018 stands close to 16.5%. Analysts suggest that this meteoric rise of Reliance Jio should be attributed to its Aggressive Pricing Strategy while on the hand Bharti Airtel did gain benefits from its pact with Tata Teleservices regarding intra-circle roaming.
Reliance Jio’s Revenue Market Share rose sharply from 15.3% in Q3 FY 2018 to 19.8% in Q4 FY 2018. The other telecom operators Bharti Airtel and Vodafone saw a wafer-thin increase in their RMS with a 0.7% increase witnessed by Vodafone while Airtel’s RMS went from 30.9% to 31.8%.
Navin Kulkarni, a telecom analyst at Philips Capital states that with Jio’s strong and sustained RMS growth rates, it can easily surpass the second largest telecom operator Vodafone (independently) in the first quarter of 2019.
Adjusted Gross Revenue: The Real Picture?
Reliance Jio saw a gigantic 18% jump in Adjusted Gross Revenue (AGR) to Rs 6,300 crore by the end of March 2018. Airtel witnessed a massive fall of 5.5% and reported its AGR as Rs 10,100 crore. Vodafone also saw a fall of around 4.8% and its adjusted gross revenue was to the tune of Rs 6700 crore. Idea Cellular suffered the greatest fall of 8.8% and its AGR clocked close to Rs 5200 crore.
The industry as a whole lost about 8.2% of AGR this quarter to about Rs 31,800 crore. AGR or Adjusted Gross Revenue is mainly derived from licensed services.
The TRAI data mentions that Reliance Jio is among the top 2 operators in 18 out of 22 circles based upon AGR. In addition to that, the telecom operator also enjoys more than 25% AGR market share in 15 of these circles.
Embarrassingly enough, the older players Bharti Airtel, Vodafone and Idea saw a sequential rise in their AGR in just six, five and two circles respectively out of the 22 they operate in. To top over that, their Average Revenue per User has also seen a significant dip of over 45% in seven, two and eight circles respectively.
Industry analysts claim that users generally exploit Reliance Jio’s unlimited Voice Calling and text SMS benefit to use these facilities, while the other carrier connections are used mainly to receive incoming calls.
Analysts also claim that the fall in the AGR of industry in this quarter could be due to the price cuts by TRAI introduced in this January and also reduction in long distance termination rates. Some suggest that revenue consolidation between larger players could also have played a role.
Idea Vodafone Merger: Desperate Attempt To Save The Sinking Ship
The highly anticipated merger between Idea and Vodafone due this month will surely bring about changes in the revenue market shares. Reportedly, the joint entity will enjoy a fat 37.5% of revenue market share and would cater to around 430 million active subscribers. Their joint revenue would clock close to Rs 63,000 crore.