Reliance Jio’s decision to phase out its entry-level 1GB daily allowance prepaid packs raises the base for its mobile offerings and signals a focus on value and monetisation over subscriber addition, analysts said. “Given prior trends, it is highly likely that Bharti and VIL will also phase out their 1GB/day plans,” analysts at JM Financial noted. Analysts say the move underscores the telcos’ growing pricing power.
Industry implications and pricing power
Analysts at Morgan Stanley said that while discontinuing specific plans may not materially move overall average revenue per user (Arpu) immediately, it reinforces the trend of industry repair and monetisation, with room for future tariff hikes across 4G and 5G offerings. Jio has moved the Rs 249, 28-day pack with 1GB daily allowance off its website — it is now available exclusively at physical points of sale. The Rs 209, 22-day validity pack with 1GB daily allowance can be accessed only on the MyJio app. Sources said these were losing popularity and will be discontinued. “Per capita data consumption on the Jio network is inching towards 40GB per month, so lower allowance data packs may not remain relevant over time,” a telecom expert said.
The Vodafone Idea stock was up 2.01% at Rs 6.59 while Airtel’s was up 0.88% at Rs 1,909.60 on the BSE on Tuesday, a day after the Jio move. Rising use of data makes lower-tier plans increasingly redundant. The narrowing price gap between entry-level and minimum 5G plans could encourage wider 5G adoption.
Arpu boost from plan upgrades
The immediate financial implication for Jio could be significant. Around 20-25% of Jio’s 498 million subscribers were on the affected 1GB/day plan, analysts observed. If these users upgrade to the new 1.5GB/day plan, the company’s Arpu could rise by Rs 11-13 per month, or 6-7%, potentially lifting consolidated FY27 Ebitda by Rs 1,900-2,200 crore, according to analysts at JM Financial. For Bharti Airtel, a similar move could lift Arpu by Rs 10-11 per month (4-4.5%) and India wireless Ebitda by roughly Rs 1,800-2,000 crore, while Vi could see Arpu gains of Rs 13-14 per month (7-8%).