According to data from Telecom Regulatory Authority of India (Trai), around 5% of wireless subscribers are postpaid users and they generate around three times higher average revenue per user (Arpu) compared to prepaid users
MUMBAI: Reliance Jio on Tuesday announced a slew of new postpaid plans, setting its sight on the subscriber base of rival telcos. The plans come bundled with over the top (OTT) subscriptions such as Netflix, Amazon Prime, Disney Hotstar including in-flight connectivity among other offers, the Reliance Industries subsidiary said.
More importantly, it has offered postpaid users of other service providers the provision of carrying over their credit limit to the Jio network if they port their numbers to company with home delivery of new SIM cards.
The move is significant as telcos have been struggling to find ways to introduce tariff hikes to shore up their revenue. According to data from Telecom Regulatory Authority of India (Trai), around 5% of wireless subscribers are postpaid users and they generate around three times higher average revenue per user (Arpu) compared to prepaid users.
Jio’s existing postpaid subscribers form a negligible part--around 1%--of its total user base with an entry level plan of ₹199 per month with 25 GB data. Akash Ambani, Director, Jio, said, “There can’t be a more opportune time to introduce JioPostpaid Plus. After having earned the trust of close to 400 million satisfied customers in the prepaid smartphone category, we want to extend our customer obsession to the postpaid category."
The plans will be available starting 24 September. The offers start at ₹399 per month with 75GB data, unlimited messaging and Netflix, Amazon Prime and Disney Hotstar subscriptions. This competes with existing entry level postpaid offers from both Airtel and Vodafone Idea.
According to industry experts, postpaid plans also foster better brand loyalty, a concern, that Jio has struggled with.
Airtel has postpaid plans starting at ₹499 per month which offers 75GB data and unlimited voice calling. Offers include a one-year free subscription to Amazon Prime, Zee5, and Airtel Xstream App.
Vodafone’s postpaid plans at ₹399 a pack which offers 40GB data along with 100 messages and unlimited calling for one month with free Vodafone Play subscription and Zee5 Premium access for a year. But over 7% and 5% of Vodafone Idea and Airtel users are on postpaid plans.
In the March quarter, as per Trai, postpaid ARPU was at ₹244 compared with prepaid ARPU of ₹84.
Jio is also expected to launch affordable smartphones soon which will complement the higher value postpaid plans.
According to a recent survey by Bofa Global Research (21st September), 68% of surveyed users indicated that they won’t mind paying telcos 15-20% higher for the same data allowances. Telecom experts had expected a second round of tariff hikes (post December 2019) to be introduced in September following the much-awaited Supreme Court decision on Adjusted Gross Revenue dues. That has not happened yet.
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