Reliance Jio free offer extended till 31 March, says Mukesh Ambani
- Adani drops contractor for Carmichael coal mine in Australia
- UN to vote tomorrow on measure rejecting US Jerusalem decision
- Oracle agrees to buy Australia’s Aconex for $1.19 billion
- Nearly 13% dip in number of Indians visiting US
- Opening Bell: Asian markets open higher; all eyes on election results; Mahindra Finance in news
Mumbai: India’s Reliance Industries announced a three-month extension to an offer of free data and voice services by its telecoms unit Reliance Jio, signalling that a brutal price war in India’s mobile sector that has already hurt its rivals is intensifying.
Reliance chairman Mukesh Ambani, India’s richest man, said in a live feed on YouTube on Thursday that Reliance Jio’s existing and new customers will get free voice and data till 31 March 2017. The free offer was earlier valid till 31 December.
Relaince Jio had made a splash in September by offering the free data, and rivals such as Bharti Airtel have been forced to respond with price cuts of their own, though at a steep cost.
After Ambani’s announcement on Thursday, Bharti shares slumped 2% while Idea Cellular Ltd plunged 6%.
Ambani added that Reliance Jio has crossed 50 million customers in the three months since launching on 1 September, and accused its competitors of unfair tactics, including blocking voice calls made through Reliance Jio to other networks.
Relaince Jio has so far invested over $20 billion in establishing a country-wide telecoms network, but still lags well behind Vodafone’s around 200 million customers and Bharti’s more than 257 million subscribers.
Vodafone last month reported a first-half net loss of €5 billion ($5.5 billion) after writing down the value of its Indian business by the same amount due to the price war sparked by Reliance Jio’s arrival.
The outlook for the telecoms sector took a further hit since Prime Minister Narendra Modi imposed a ban on Rs500 and Rs1,000 denominated notes, sparking an intense cash crunch that threatens to erode consumer spending. Most Indians still use cash at local touchpoints to recharge so-called pre-paid connections.
But the move also boosts service providers such as Bharti that are expanding into digital payments.
Ambani on Thursday also announced that Reliance Jio would roll out Jio-Money Merchant Solutions, a mobile payments application, for enabling digital payments for small merchants at their various point of transactions.
The application will be rolled out from 5 December. Reuters