Sunil Bharti Mittal in an interview to ET Now on Wednesday said that the data business is under pressure due to Reliance Jio’s freebies. “When something is out there in the market, free, and is being consumed, obviously the data growth would taper off for a period of time. Let’s wait till December, once the free offer goes away. That’s the time we need to assess how it settles down.” Mukesh Ambani-promoted Reliance Industries Ltd (RIL) has unleashed a price war in the telecom sector by offering voice calls free both local and while roaming and promising to offer data at cheap prices of Rs 25-50 per gigabyte (GB) through its unit -Reliance Jio Infocomm Ltd.
While Reliance Jio has been asked by the TRAI to end its ‘Welcome Offer’ by December 3, analysts are of the view that the Mukesh Ambani-led telecom venture may find a way to extend the free service till March 2017! According to a latest Motilal Oswal report, Reliance Jio has indicated that it may extend the free offer, if the need arises. Motilal Oswal analysts have in a new note said, “Mass scale free welcome offer could continue until March 2017 to attract subscriber growth towards the celebrated 100 million mark with RJio’s indicative data pricing at Rs 130-140 per GB.”
Not only that, Citi Research analysts have also reportedly said that Reliance Jio may continue with its promotional offers. While a TRAI directive says that any free services plan cannot extend beyond 90 days, Citi Research analysts have reported Reliance Industries management as saying that there are no restrictions on the number of promotional offers. It appears that Reliance Jio feels that unless it is able to deliver quality service to customers, it is unfair to charge them.