1. Reliance Jio’s 4G paradise a dream? Data speed dips, telco faces stiff competition from Airtel, warn analysts

Reliance Jio’s 4G paradise a dream? Data speed dips, telco faces stiff competition from Airtel, warn analysts

According to a report by CLSA, Reliance Jio saw a 20 per cent fall in speeds from 7.2 mbps in September to 6 mbps in October and with 17 of the 22 markets reporting the fall..

By: | Updated: November 4, 2016 4:28 PM
Jio’s current speed of 6 mbps is almost half of Airtel’s 4G speed of 11.47 mbps, which is likely to help Airtel retain its market share lead. Jio’s current speed of 6 mbps is almost half of Airtel’s 4G speed of 11.47 mbps, which is likely to help Airtel retain its market share lead.

When Mukesh Ambani launched Reliance Jio he promised high speed 4G data across India. But, he has failed to keep the promise it seems! The 4G data speed of Reliance Jio declined by about 20 per cent in October across 17 circles. According to a report by CLSA, Reliance Jio saw a 20 per cent fall in speeds from 7.2 mbps in September to 6 mbps in October and with 17 of the 22 markets reporting the fall, a quick subscriber ramp-up led by ‘free offers’ impacted service quality in most markets. Jio’s current speed of 6 mbps is almost half of Airtel’s 4G speed of 11.47 mbps, which is likely to help Airtel retain its market share lead. During the same period, Bharti Airtel saw an increase in speeds in 10 of its 16 4G markets and also expanded its 4G service to cover 19 of the total 22 markets. Reliance’s disappointing 4G speeds might have a favourable impact for Airtel which may be able to hold on to its market share. “We are positively surprised by the network outperformance of Bharti Airtel and maintain that it remains a key driver of market share gains. Among the four large operators, while Bharti Airtel and Idea Cellular have improved/maintained 4G speeds, Vodafone and Reliance Jio have seen a fall,” CLSA said.

The findings are part of CLSA’s second edition of quality of service tracker, which analyses the Telecom Regulatory Authority of India’s speed test data based on 2.5 million and 0.5 million samples on 4G and 3G networks, respectively. At 6 mbps, Reliance Jio’s speeds were similar to the average speeds of Idea Cellular and Vodafone at 7 mbps but nearly half of Bharti’s 11.5 mbps. The research firm said if Reliance Jio’s 4G speeds do not improve, the new entrant might extend “free offers” beyond December adding risks to the data pricing of incumbents.

Separately, Fitch on Friday said that Reliance Industries’ arm Jio faces stiff competition from financially strong incumbent telecom players like Airtel and future capex will depend on growth of its customer base. Fitch re-affirmed ‘BBB-minus’ rating on RIL with stable outlook on strength of its robust refinery and petrochemical business and expects benefits from its investments in the core business to start accruing from 2017-18. The rating agency, however, expected RIL to be able to take advantage of the strong growth potential in the Indian telecom market as it has invested significantly in infrastructure that would cover 90 per cent of the population by 2017-18 end.

“Jio will face intense competition from the financially strong incumbent Indian telecom players, but we believe falling data tariffs will support significant expansion of overall data consumption in India over the medium term,” it said, adding that the robust infrastructure along with its affordable 4G data offerings will support Jio’s growth. Fitch said it expects “Jio’s wide range of offerings, including media and entertainment content, to help in subscriber additions and data consumption, which will drive cash generation”.

RIL also continues to face challenges in its upstream oil and gas operations with declining production and weak prices. “We expect RIL’s upstream operations to remain weak over the short term because of weak oil and gas prices, and geological challenges in its domestic fields,” it said. The company’s ongoing investments will drive up RIL’s debt levels in the current fiscal. “However, Fitch expects its financial profile to improve from 2017-18 onwards with higher cash generation from its refining and petrochemical operations,” the statement said. Expecting financial leverage to improve by 2018-19, Fitch said this provides some rating headroom under its unconstrained-‘BBB’ credit profile during its ongoing heavy investment in the telecom operation.

  1. K
    Kishore tiwari
    Nov 5, 2016 at 2:50 pm
    Jio is great thanks again to AmbaniKarlo duniya mutthi mein 👍👌👌☺
    Reply
    1. A
      Ashwin Kumar
      Nov 5, 2016 at 6:26 am
      Hey I have not used even 3g before because of high rate .now iam using 4g. Its a great offer for all.
      Reply
      1. A
        Achchhey Lal Bharti
        Nov 12, 2016 at 3:00 pm
        Mukesh ambani is befooling us in the name of Jio 4g speed. Worse speed in rural area.
        Reply
        1. A
          alok
          Nov 5, 2016 at 6:19 am
          when any company give u free 4g then why should you comparison with others.i think u dont have sense to how can you do the comparison.
          Reply
          1. A
            ashim
            Nov 6, 2016 at 6:32 am
            Jio’s network carries 16,000 terabytes of data traffic a day, it said, exceeding the levels of China Mobile (12,000-plus TBs/day), Vodafone Global (6,000 TBs/day), China Unicom (4,000 TBs/day) and Bharti Airtel (2,000 TBs/day). Jio’s data traffic of 16,000 TBs a day is based on the company’s 16 million customers consuming 1GB of data daily.Read more at:source=contentofinterest&utm_medium=text&utm_campaign=cppst
            Reply
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              ashim
              Nov 6, 2016 at 6:31 am
              Reliance Jio’s per day data traffic higher than other telcos: Credit Suisse Jio’s network carries 16,000 terabytes of data traffic a day, it said, exceeding the levels of China Mobile (12,000-plus TBs/day), Vodafone Global (6,000 TBs/day), China Unicom (4,000 TBs/day) and Bharti Airtel (2,000 TBs/day). Jio’s data traffic of 16,000 TBs a day is based on the company’s 16 million customers consuming 1GB of data daily.Read more at:source=contentofinterest&utm_medium=text&utm_campaign=cppstRead more at:
              Reply
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                Bijo
                Nov 5, 2016 at 9:12 am
                Jio gives unlimited Internet with FUP limit. Is the 6Mbps average calculated with all samples with non-FUP speed. If not, result is incorrect. Airtel on the other hand provides same speed always. Let's compare apples with apples please.
                Reply
                1. R
                  Raja chadha
                  Nov 4, 2016 at 2:58 pm
                  True. Using Jio since July. But data speed has reduced not working in morning also.Will wait till DEC only.
                  Reply
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                    Asif Ali
                    Nov 5, 2016 at 2:00 am
                    Biased article against Jio. Free 6mbps is better than 11mbps at exorbitant price. Also Jio is a lot better in call quality and connectivity all for free and at a very affordable rate post promotion date. Love Jio!
                    Reply
                    1. K
                      khadar khan
                      Nov 5, 2016 at 5:09 pm
                      Let them compare in future when pre or Post paid starts.when I get something don't have comparisons
                      Reply
                      1. J
                        Jaikumar
                        Nov 4, 2016 at 3:45 pm
                        What a stupid analysis is that. Jio's current userbase is around 24 million. Giving 4gb data free to everyone and still giving 6 mbps speed. Airtel 4g userbase is not even 2.4 million and its paid. How can you compare that. It's stupid comparison.
                        Reply
                        1. J
                          Jayaprakash
                          Nov 5, 2016 at 4:55 pm
                          I am experiencing upload/ download speed of less than 1mbps in Bangalore..... very much disappointing
                          Reply
                          1. M
                            Mansukh Patel
                            Nov 5, 2016 at 1:12 am
                            Everything is fair when it's free old saying beggars can't be choosers
                            Reply
                            1. M
                              Mansukh Patel
                              Nov 5, 2016 at 1:13 am
                              Freebies can't demand
                              Reply
                              1. M
                                Manoj Jain
                                Nov 5, 2016 at 7:18 am
                                To say that Jio offers 6 Mbps is being very generous. In my area in Delhi I usually get sub 2 Mbps speeds and in fact what I mostly get is 16 kBps. This was the sort of speed one got in the early 2000s, so Jio has taken us back 15 years !It is now going to be 2 months since the service was launched, and there is no sign of any improvement in the speed. With this service, forget 100 million, Jio will be lucky to get 1 million paying subscribers.
                                Reply
                                1. S
                                  Sumedh
                                  Nov 4, 2016 at 11:48 am
                                  Jio's speeds are good considering the fact that the service is free to all the customers and the amount of data that is being consumed is lot more than that of other operators.If Airtel also gives free data to as many customers as Jio has, I doubt that the speeds of Airtel will not even be half of what we are getting currently.The real speeds of Jio come out after its commercial operations start!
                                  Reply
                                  1. R
                                    Rajan
                                    Nov 4, 2016 at 11:40 am
                                    What dope are you on? i have subscribed to Airtel 4G services for months now. Never got any speed even close to what you are mentioning. This is despite getting a monthly bill of over 3K regularly. What can be a greater fraud than this
                                    Reply
                                    1. R
                                      ramakrishna
                                      Nov 24, 2016 at 7:50 am
                                      not true jio works very well indeed
                                      Reply
                                      1. R
                                        ramakrishna
                                        Nov 24, 2016 at 7:21 am
                                        jio has great speeds wondeful service
                                        Reply
                                        1. K
                                          Ketan Rawal
                                          Nov 5, 2016 at 1:41 am
                                          Jio has revolutionise telecom internet and gave and provided opportunity to feel the power of inhernet. Speed is awesome considering its user base at this time. Comparison with Airtel is ridiculous as Airtel has not even 10℅ data trafic compared to Jio. All the best.
                                          Reply
                                          1. S
                                            saif
                                            Nov 5, 2016 at 2:03 pm
                                            Some people will still complain even if the speeds goes up to like 100000 Gbps .............bad article, comparing free vs paid is stupid.
                                            Reply
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