Reliance Jio, India’s largest telecom operator by market share, has reduced the entry barrier for its customers to use 5G services, by adopting a strategy which provides users the choice to use 5G services when they wish to while retaining their specific 4G tariff pack.
The company has done so by upgrading its 4G data add-on plan of Rs 61 to 5G, which will allow its users having recharge plans below Rs 239 to get a 5G welcome offer.
The upgraded-5G offer is applicable on 4G recharge plans of Rs 119, Rs 149, Rs 179, Rs 199, and Rs 209. This means that users who have an active plan of Rs 119, for example, can pay Rs 61 to use Jio’s 5G and their 4G data will not get exhausted.
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Till now, Jio has been providing the Rs 61 plan as a 4G data top-up plan offering 6 GB data.
As of now, Jio’s users with recharge plans of Rs 239 and above were able to get an experience of 5G services on their 5G-enabled smartphones and at locations where 5G services are rolled out by the company.
In comparison, Bharti Airtel has no such barrier for a minimum recharge to get 5G and provides its 5G services on the existing 4G plans with a data limit.
“Unlimited 5G data applicable only in cities where Jio True 5G has been launched and user has been invited for Jio Welcome Offer,” Reliance Jio said.
“This has been done to offer 5G experience to masses. Users can get unlimited 5G data on the existing 4G plans at locations where 5G is rolled out by the company,” a Jio spokesperson said, adding that the validity of the plan will be the duration of their current active 4G plan.
This approach from Jio through data add-on plan is seen as a market test by the company to take stock of consumer behaviour, according to analysts.
“The drivers of 5G will be high quality consumers and enterprises. Telcos have been benefiting from data monetisation given the increase in data usage by the consumers. The uptake of the 5G at the lower end through data add-on plans might be in euphoria by the users,” a Mumbai-based analyst said, adding that this is not going to change the company’s Arpu (average revenue per user) much.
Currently, Jio’s 5G services are live across 85 cities across the country.
According to a survey by brokerage house CLSA, 88% of 1,500 respondents in urban areas are willing to pay a premium for 5G services, and 60-74% of respondents were even willing to pay up to 20% higher.
“Bharti and RJio’s early 5G monetisation would be led by top-end mobile postpaid subscribers alongside increases in Bharti and RJio mobile network capacities,” CLSA said, adding that fixed wireless access for the home broadband using 5G would also be a massive driver of 5G in the country.
The brokerage expects a $5-9 billion annual revenue opportunity for the telcos from fixed wireless access.
With regards to current usage of 5G, data usage and video streaming are dominant, followed by gaming and social media usage, according to analysts.