Reliance Jio offers free broadband, double data amid Covid-19 lockdown

Reliance Jio will offer basic JioFibre broadband service to new customers and doubled data limit for all its existing customers to support work from home in fight against coronavirus. The company announced the plans on Monday through its #CoronaHaaregaIndiaJeetega initiative.

Jio has also doubled data limits for top-up voucher and bundle-free calling minutes to non-Jio networks in these vouchers.

"To ensure that everyone stays connected while at home, Jio will provide Basic JioFiber broadband connectivity (10 Mbps), wherever it is geographically feasible, without any service charges, for this (coronavirus) period," Reliance Industries said in a statement. The company will also provide home gateway routers with a minimum refundable deposit.

JioFibre broadband customers are required to pay Rs 2,500 at the time of installation. Of which, Rs 1,500 is refundable at the time of surrendering the connection.

The company has started offering double data across its 4G data add-on vouchers which will also bundle non-Jio voice calling minutes in these vouchers at no additional costs.

"As its ongoing commitment, Jio is ensuring that its mobility services are up and running at all times with the deployment of essential teams on rotation round the clock across the country," the statement said.

However, state-owned telecom companies BSNL and MTNL took lead last week to announce free broadband plans and additional data for their customers to support work from home. The government had earlier instructed the private companies to let their employees avail WFH, amid growing concerns over coronavirus spread as India records 433 positive cases and 8 deaths.

Reliance Jio may gain 10% telecom market share to reach 44% by FY22: Report

Reliance Jio may increase its market share to 44 per cent by the end of the financial year 2021-22 in telecom, a Bernstein report said on Friday. Currently, Jio's market share in telecom is around 34 per cent.

"Over the past three years, Reliance has achieved a leadership position in telecom with a 34 per cent market share. We expect it to reach a 44 per cent share by FY22 and achieve returns above WACC (weighted average cost of capital) for the first time," said the report.

Regarding the company's growth in the retail segment, it said that the "greatest growth opportunity" lies in the organised retail segment.

"We expect India's retail market, which is currently 90 per cent unorganized and ready for digital disruption, to reach $1.2 trillion by 2025. Reliance is the offline leader with $18.5 billion in revenues and 11,000+ stores. The company is best positioned in New Commerce, digitizing neighborhood stores, and e-commerce apps (JioMart and AJIO). Beyond retail, we see opportunities in fintech and media, where there are clear opportunities for synergies with telecom."

The report further said that although energy remains the "cash cow" of the business for RIL, in the near term, it is likely to face margin pressure.

Although Reliance plans to sell down a stake to Aramco, this does not mark a retreat from energy, with India likely to be the fastest-growing market for refined fuel products and petrochemicals over the next 20 years, as per the report.  

Reliance Jio EBIT jumps 60% in Q3, operating revenue rises 28.3%

Reliance Jio posted a 60.6 per cent earnings before interest and tax to Rs 3,805 crore, riding on 28.3 per cent jump in the operating revenues, which came in at Rs 13,968 crore. The telco, however, saw 22 million subscribers leave its network thanks to the implementation of interconnect usage charges (IUC) charges.

These were primarily voice customers. This along with the tariff hikes implemented during the quarter (around mid December) and the huge offtake for JioPhones led to a rise in the average revenue per user (ARPU) on a quarter-on-quarter (QoQ) basis to Rs 128.4. On a year-on-year (YoY) basis, however, the ARPU is lower compared to Rs 130 in the corresponding period a year ago. The reported ARPU in the September quarter was Rs 120 and if adjusted for IUC charges it was Rs 127 (on a like-to-like basis).

Jio’s ARPU was slipping for seven consecutive quarters. This was the first improvement after many quarters.

Anshuman Thakur, strategy head for Reliance Jio, said the improvement in ARPU over the previous quarter was due to a combination of things.

“There was a tariff increase, but that impact was minimal (it was from mid-December) as most consumers are on three month plans. So, many of them are still on previous plans. There was some IUC revenue as well and we also had a very good quarter with JioPhone,” he said.

Jio’s subscriber base as on December 31 was 370 million, which shows a 32.1 per cent YoY growth. The telco added 37 million gross adds during the third quarter of financial year 2019-20, while its net adds stood at 14 million. In the September quarter, the net subscriber addition was 24 million. The rate of net additions was, thus, slowing down.

Thakur said, “We were aware of the implications of IUC tariffs and certain customers would be impacted”. There has been a traffic pattern change after the implementation of IUC — from 38 per cent inbound traffic to 53 per cent at present. Thakur said at the end of the quarter Jio was a net IUC gainer.

IUC basically refers to a charge paid by the call-originating telco to the destination operator. Jio wants the IUC to go (that will help it to lower costs), while incumbent telcos want IUC to stay and they are net revenue gainers from it.

chartJio posted a net profit of Rs 1,350 crore, up 62.5 per cent YoY, after exceptional items of Rs 177 crore (on account of adjusted gross revenue or adjusted gross revenue dues) during the quarter.

The telco’s wireless data traffic during the quarter was 12 billion GB, registering a 39.9 per cent YoY growth. Asked if there was any plateau of data consumption, Thakur said, “We are still seeing growth in consumption. The base has become so much larger. On per user basis you may not see such a big number but the growth is still there”.

Meanwhile, Jio claimed that it was on track to becoming a net debt free company. In October, it had announced the formation of a wholly-owned subsidiary for its digital initiatives Jio Platforms (JPL) with a total capital infusion of Rs 1.73 trillion. Under this arrangement, around Rs 1.08 trillion of Reliance

Jio’s liabilities will be transferred to Reliance Industries (RIL).

Thakur explained that the process of debt transfer to RIL is being done through a scheme of arrangement. Jio has filed the scheme with National Company Law Tribunal (NCLT), seeking approval for transfer of identified liabilities to RIL in December 2019. “In September, the debt was Rs 1.04 trillion based on which we had filed the scheme. That has gone up marginally,” Thakur said.

As for its fiber-to-the-home (FTTH) service, Jio already has 1 million consumers and is ramping up.

Jio follows Voda Idea, Airtel in raising tariff; rates to begin at Rs 199

Following new tariff plans announced by incumbent telecom operators, Reliance Jio has updated its tariff plans, which will be applicable from December 6.

“These plans will provide up to 300 per cent more benefits to Jio customers, upholding the Jio promise of providing best-quality service at the lowest price globally,” said the company in a statement.

The company had already announced that while the new all-in-one plans would be 40 per cent more expensive, they would seek to offer higher subscriber benefits.

Bharti Airtel and Vodafone Idea had, on Sunday, announced a tariff hike in the range of 15-40 per cent, across different plans. The tariff hike by both operators came into effect on December 3.

Jio follows Vodafone Idea, Airtel with tariff hikes, prices start at Rs 199

“Bharti Airtel and Vodafone Idea have announced a sub-25 per cent tariff hike for plans of Rs 349 and below, which cover close to 60 per cent of subscribers. We believe the average impact on average revenue per user, or ARPU, would be 25-30 per cent on account of the tariff hike. While it was anticipated that TRAI would float a consultation paper to do so, the incumbents announced tariff hikes without any assistance from the regulator,” noted Shashi Bhushan, executive director (IT and Telecom) at Axis Capital, following the tariff hikes reported by Bharti Airtel and Vodafone Idea.

Analysts see the tariff hike as much-needed financial cushion for incumbents. Since there has been no assistance from the regulator, this trend is expected to continue, with at least one more round of hike needed to stabilise Vodafone Idea’s finances.

Jio’s new tariff plans have been kept at a differential of Rs 50 from most of the incumbents’ tariff plans, effectively keeping Jio’s plans almost 25 per cent cheaper. However, analysts note that going forward, service quality and content offering will be the differentiators for operators.

Telecom tariff: Jio to follow Airtel, Voda Idea, raise rates in a few weeks

Reliance Jio, which disrupted the telecom market ever since its commercial launch in 2016, has decided to follow rivals Bharti Airtel and Vodafone Idea in raising mobile phone tariffs. Having kicked off a no holds barred tariff war three years ago, the Mukesh Ambani-owned firm is now stepping back.

According to sources in the know, the tariff hike decision by the telcos is in response to the government wanting the industry to stop the long-drawn price war and set their house in order. In the absence of a tariff hike, Telecom Regulatory Authority of India (Trai) may have been forced to impose a floor price for the operators. Also, the government has been of the view that any relief measure for the telecom industry should be given only after telcos get out of the price war, that has left the incumbent operators with record losses and high debt, the sources said.

On Tuesday evening, Jio announced it would take measures including “appropriate increase in tariffs’’ in the next few weeks. The move, industry watchers believe, may bring down the pitch of the bitter battle between the incumbents and a new player. Jio’s announcement comes a day after Airtel and Vodafone Idea said they were hiking tariffs from December 1.

In its statement, Jio has asked the government to mandate a ‘2G mukt’ India in the shortest time if the objectives of Digital India mission has have to be achieved. The Jio demand for a 2G-free country is significant as it’s the only operator offering just 4G services pan-India. Bharti Airtel and Vodafone Idea still have a bulk of their customers using 2G.

In anticipation of the tariff hike (the announcement came after market hours), Reliance Industries’ market cap crossed the Rs 9.5-trillion mark on Tuesday.

It’s the first Indian company to reach the milestone, with its stock price rising 3.59 per cent, closing at Rs 1,511.55 on the NSE. Shares of rival firms Bharti Airtel and Vodafone Idea also rallied by 8.66 per cent and 38.2 per cent, respectively.

After the Supreme Court judgment, asking telcos to pay dues related to adjusted gross revenue (AGR) that could amount to more than Rs 1.33 trillion, the incumbents sought a moratorium on deferred spectrum payments and a cut in spectrum user charges among other relief measures.

Chairman Mukesh Ambani had earlier assured the Jio customers that the company’s tariffs would always effectively be 20 per cent cheaper than their competitors. Now, even with competitors raising the tariff, Jio plans to maintain the price gap.

chartHowever, according to SBI Caps analysis, with Jio’s tariff plan now including the interconnect usage charges (IUC) minutes, the premium between the like-for-like tariff plans with competitors has already reduced to 4 to 11 per cent, giving the incumbents room to increase tariffs. Jio, however, has made a commitment that the additional charge will be withdrawn once the Trai ends the IUC regime.
In any case, the tariff hike may not significantly impact customers, as they would pay much less then what they did before the Jio onslaught began in September 2016.

Currently, the average revenue per user (ARPU) per month is pegged at Rs 107 for Vodafone Idea, while it’s Rs 128 for Airtel. Jio’s ARPU stands at Rs 120. The tariff war is evident from the change in ARPU in the case of the long-time industry leader Bharti Airtel—in June 2016, the company’s Arpu was Rs 198, and now it’s down to Rs 128.

Even late last year, the finance ministry had sent feelers to the telcos to make rational hikes in tariffs in order to get out of the financial mess instead of just asking the government for relief measures. However, the price war continued unabated.

Analysts are expecting an average increase in tariffs ranging from 10 to 20 per cent. According to SBI Caps, a 15 per cent hike in tariffs will only partially address the cash burn for Vodafone Idea and help meet the AGR dues of Bharti Airtel. It estimates that for Vodafone Idea, such an increase will improve the cash flow by Rs 5,400 crore, which will partly meet its cash burn of Rs 24,100 crore in FY20. That excludes the AGR payout dues. In the case of Bharti, a tariff hike in that range will improve its cash flows by Rs 5,800 crore and help it partially meet the AGR dues.

Delaying zero IUC regime will hurt affordability of telecom services: Jio

Reliance Jio on Friday said that delaying the implementation of zero call connect charges beyond January 2020 will hurt affordability of telecom services in a sector where users have benefited from free voice calls.

Reliance Jio Director Mahendra Nahata said that the ratio of incoming and outgoing call is now at par with each other and traffic asymmetry can, therefore, no longer be the reason to delay implementation of Bill and Keep (BAK) regime (that is zero mobile termination charge from January 1, 2020).

Traffic symmetry indicates that telecom operator will not have any outstanding balance of interconnect usage charges (IUC) against other networks.

Speaking at Telecom Regulatory Authority of India's (Trai) open house on IUC issue, Nahata said Airtel had expanded 4G network and Vodafone Idea too is talking about expanding their 4G network.

"We are not considering any profit or loss, but opposing it on the basis of principle. Criticising the decision of government or regulatory authorities from a distant location is beyond our understanding. Therefore, please take a decision after due diligence on all the points that we have raised," he said.

Nahata questioned data being shown by telecom operators and alleged that the subscriber traffic is being diverted to 2G, 3G network to show cost of voice is high.

ALSO READ: No relief for telcos: Govt wants all AGR dues paid within three months

Nahata said that in case Trai does not favour implementation of BAK regime from January 2020 then at least interconnect usage charges currently at 6 paise should be brought down.

"When you had implemented 6 paise charge, 4G traffic was one per cent. Today that traffic is much higher so the costs must have come down," he said.

A Vodafone Idea official said that consumers today have the option of moving to other networks through mobile number portability (MNP).

"Today customers have option of MNP and they can move to other network. It is wrong to say that any operator is holding back customers on 2G network," the official said, demanding that the mobile call termination charges should continue.

Airtel said that IUC should not come down to zero and the BAK regime should be postponed by at least three years.

Meanwhile, Bharti Airtel's Chief Regulatory Officer Ravi Gandhi rejected allegations of data fudging terming them as "misplaced" and said that people at times used the company's SIM into second slot of mobile phone which generally supports 2G or 3G network.

He said there are 40 crore consumers are on 2G network and they use low-cost feature phones. Shutting down 2G network will mean depriving such consumers of telecom services.

AGR ruling: Reliance Jio advises Airtel, Voda Idea how to raise money

Billionaire Mukesh Ambani's Reliance Jio Infocomm Ltd. opposed any move by the government to provide financial relief to rival telecom operators, which have been ordered to pay $7 billion in past dues, saying they had adequate recourse to funds.

Bharti Airtel Ltd can easily raise 400 billion rupees ($5.7 billion) by selling some of its assets or shares, while Vodafone Idea Ltd. has no dearth of resources to pay the government its dues, Reliance Jio said in a statement dated Nov. 1 and issued Sunday. India's top court had last month ordered Bharti and Vodafone Idea to pay Rs 499.9 billion.

If Airtel liquidates “small parts of its assets or issues 15%-20% new equity,” in its Indus Tower business it can easily raise the funds, Kapoor Singh Guliani, president for regulatory affairs at Reliance Jio, said in the letter. Vodafone India also has stake in Indus Towers, “thus there is no dearth of sources to pay” their dues, he said.

Airtel’s tower business operates more than 163,000 mobile-phone towers across India.

The letter addressed to India’s telecom minister comes after a government panel agreed to examine Bharti and Vodafone’s demand for reducing the spectrum usage levies and the Universal Service Obligation Fund charge. The two carriers are struggling, with Vodafone Idea posting 11 straight quarters of net losses and Bharti slipping into its first-ever loss in the June quarter.

Reliance separately cited a Supreme Court verdict that held spectrum as a finite resource and its distribution should not be made in a manner that’s detrimental to public interest.

All operators should be mandated to deposit applicable amounts within the three-month time period, as mandated by the court, Reliance said.

Jio in letter war with COAI over telecom stress

Reliance Jio slammed its peers, Bharti Airtel and Vodafone Idea, and questioned the telecom sector stress in a strongly worded letter to the Cellular Operators Association of India (COAI).

This started on October 24, when the Supreme court dismissed a plea moved by the telecom operators, challenging the definition of adjusted gross revenue (AGR).

The verdict allows the government to recover Rs 92,000 crore of AGR from the already financially stressed telecom industry that includes many operators who’ve already gone out of business or are under insolvency proceedings.

However, the incumbent telcos Bharti Airtel and Vodafone Idea reacted strongly to the judgment. While Bharti believes it would weaken the viability of the telecom sector, Vodafone has said it may consider filing a review application.

Shares of Bharti Airtel and Vodafone Idea reflected the verdict’s adverse impact on the telcos during that day, but recovered later.

In view of this, the COAI had written to Communications Minister Ravi Shankar Prasad, on Tuesday, October 29, claiming that the Supreme Court (SC) judgment on the adjusted gross revenue (AGR) will lead to a monopoly in the sector and the government’s digitisation programme will suffer.

But Jio has a different point of view! To know more listen to this podcast...

AGR verdict: Reliance Jio says telcos have sufficient capacity to pay dues

Strongly opposing a bailout of telecom companies at taxpayers' expense, Reliance Jio on Thursday wrote to Telecom Minister Ravi Shankar Prasad saying firms that have been ordered by the Supreme Court to pay past statutory dues have "sufficient" financial capacity to clear their liabilities.

It also slammed the Cellular Operators Association of India (COAI) for writing ex-parte to the government on the financial distress in the sector, saying the body was "blackmailing" to "extract relief from the government" after all legal recourse had expired.

"We submit that the so-called affected service providers have sufficient financial capacity to pay the government dues by monetising their existing assets/investments and by issuing fresh equity in their companies," it wrote to Prasad.

AGR verdict: Jio emerges winner as Airtel, Voda Idea face $7 billion bill

In the latest body blow to India’s wireless carriers, Mukesh Ambani’s Reliance Jio has come out largely unscathed, bolstering its position as the top operator in the world’s second-biggest market by users.

The Supreme Court on Thursday ordered phone operators in the country to pay the government a combined Rs 920 billion ($13 billion) in past airwaves and license fees. The ruling came after a two-decades-old legal dispute between authorities and the companies over the payments.

In a market already bruised by a price war since Jio’s 2016 entry with free calls and cheap data, the biggest loser from the verdict is Vodafone Group Plc’s India venture -- Jio’s closest rival. The UK-based operator and its Indian partner now need to pay the government a combined $4 billion, a huge burden for a carrier that hasn’t made any profit since announcing their merger in 2017. Bharti Airtel, the No. 3 carrier, faces a bill of $3 billion, compared with Jio’s $1.8 million.

Underscoring the woes of the industry, Bharti Airtel and Vodafone Idea have racked up a combined net debt of almost $28 billion and face billions of dollars more in spending on introducing 5G networks. Bharti Airtel, controlled by tycoon Sunil Mittal, reported its first ever loss in the quarter through June.

“In case of full payment, VodaIdea will have no cash for capex or spectrum installments for next three years,” Jefferies said in a research note. “For Bharti, it will mean curtailing of capex. We await more clarity on amount and terms of payment.”

Shares of Vodafone Idea headed for their biggest two-day plunge on record. They tumbled as much as 16 per cent on Friday in Mumbai to a record low, following a 23 per cent drop on Thursday. Airtel was little changed after gaining 3.3 per cent Thursday.

Deep Pockets

Although Jio, backed by the deep pockets of Ambani’s Reliance Industries Ltd. oil-to-retail conglomerate, has spent $50 billion to build its nationwide network and had a debt of 840 billion rupees, it has reported quarterly profits this fiscal year after luring users away from Airtel and Vodafone. Reliance shares slipped 0.5 per cent after rallying 3.2 per cent on Thursday.

Still, the court’s endorsement of the way in which the government calculates the revenue of the telcos -- a share of which is paid as license and spectrum fees -- means Jio will face some pressure on earnings, according to Bloomberg Intelligence.

The Supreme Court is deciding when the carriers will need to pay the amounts.

Additionally, Vodafone faces the prospect of a $2.2 billion tax bill linked to its 2007 acquisition of Hutchison Whampoa Ltd.’s Indian operations. The U.K.-based carrier’s Indian unit, which agreed to merge with billionaire Kumar Mangalam Birla’s Idea Cellular Ltd., is fighting a government demand that came despite a ruling in its favor by the nation’s top court in 2012.

Vodafone Idea and Airtel have said they are disappointed with the ruling. The telcos may either appeal to a larger bench of the Supreme Court or ask the government to waive the penalties and interest or seek deferred payment options, Jefferies said.

The judgment throws up “two important facets,” according to Alok Shende, a Mumbai-based principal analyst for telecom at Ascentius Insights. “First, the problem can fester for years in the long drawn legal process, ballooning the final impact,” he said. “The second implication is that the policies often have an element of ambiguity that allows for different interpretations.”

Market forces easing price war among Indian telecom companies: Trai chief

India’s telecommunications regulator said that while courts have blocked its attempts to reign in “predatory pricing” by carriers, market forces are easing a tariff war that has left the country’s three big carriers saddled with debt.

In one signing of easing competition, Reliance Jio Infocomm Ltd. earlier this month said it was imposing a charge on voice calls that were formerly free. The move reversed an offer that, along with cheap data packages, had accelerated a years-long competitive battle that pushed the market price for 1GB of data per month to less than a dollar.

“Market forces are working on predatory pricing,” Ram Sewak Sharma, Telecom Regulatory Authority of India chairman, said in an interview.

Jio, which pushed its way into first place this summer after jumping into the market in 2016 with a promise of free voice calling for life, is raising prices just as rivals Bharti Airtel Ltd. and Vodafone Idea Ltd. are posting losses and selling some assets to raise cash. Jio’s reversal on free calls could mark a turning point in their quest for profitability.

Bharti Airtel, Vodafone Idea Jump After Jio Call Price Revision

For its part, the government said late Wednesday it will spend about $5.8 billion on two unprofitable state-run telecommunication companies to help them take on competition. Mahanagar Telephone Nigam Ltd., which provides services in Mumbai and New Delhi, and Bharat Sanchar Nigam Ltd., that serves the rest of the nation, would merge under the plan, Telecom Minister Ravi Shankar Prasad said at a briefing in New Delhi. MTNL has reported losses in nine of the past 10 years, according to data compiled by Bloomberg.

While Jio’s competitors have cried foul over its strategy of entering the market with free services, courts haven’t gone along with TRAI’s attempts to regulate pricing, Sharma said. Attention has focused again on the government as carriers prepare to upgrade networks to 5G. The government has said it may ask as much as $84 billion to license airwaves needed for the high-speed services.

Carriers have said they need lower spectrum prices to make 5G affordable.

Sharma said the regulator sees prices set by the government for spectrum as “reasonable,” and that it’s up to carriers to take the next step.

“Government has done everything it needs to do for 5G,” said Sharma. He also said carriers should not have to pay up-front for spectrum licenses, but instead should pay two years first, then every year after that.

He said TRAI has already made its spectrum recommendations to the government and that he couldn’t comment further.

Reliance Jio unveils new plans with bundled in interconnect usage charges

Reliance Jio has launched plans that come bundled with interconnect usage charges (IUC) usage. This comes after it announced that subscribers will have to get additional top-ups to make off net calls for compensating IUC paid by the operator. Under the new plans, Jio customers will not have to buy IUC top-up vouchers for making voice calls to other operators.

The new plans come with 2GB free daily data, with free unlimited Jio-to-Jio voice calls and 1,000 minutes of voice calling to all non-Jio numbers. From October 10, Jio has started charging customers 6 paise a minute for making calls to other operators.

The additional charge was introduced soon after the Trai moved to reopen the deadline for ending charges to terminate calls on rival networks beyond January 2020.

Jio says rivals fraudulently claiming IUC; asks Trai to slap penalties

Reliance Jio has accused Bharti Airtel, Vodafone Idea, and Bharat Sanchar Nigam (BSNL) of fraudulently claiming interconnect usage charge (IUC) from it, for incoming calls on landline numbers.

It asked Telecom Regulatory Authority of India (Trai) to penalise the three entities and to direct them to refund the money, with interest.

In a letter to Trai, it alleged the three firms have allotted mobile numbers as customer care or helpline numbers to companies such as Oyo, Justdial, and Videocon D2H.

A breach, it says, of the IUC regulations Trai issued in 2003. These prescribe separate charges for calls terminating on wireless and wireline numbers — current per minute termination charges are 6p and nil, respectively.

Jio said in all these cases the mobile number acts as a virtual number for routing customer care and helpline-related calls. “Thus, even when the calling party is dialling the mobile numbers, all such calls are actually terminating on the fixed lines without ever touching the radio access network of the terminating operator,” went the Jio letter.

It said this situation changes the nature and character of a call from ‘mobile to wireline network’ to ‘mobile to mobile network’.

In the interconnect agreements signed between Jio and Airtel, Vodafone Idea and BSNL for calls on universal access and toll-free numbers, the originating operator receives 36-52p a minute from the terminating one.

“We suspect thousands of such numbers are operational in the market, deployed by them,” Jio said.

An Airtel spokesperson said this seems like an attempt by Jio to misguide Trai in the run-up to the consultation on IUC. “Enterprise customers referred to by Jio transfer their call to their unique number to a fixed line or another mobile number as this is permitted by the DoT. There is no loss to originating operator as the customer always dials a mobile and not a fixed-line number.”

Bad news for Jio users as calls to rival networks won't be free anymore

Forced by regulatory uncertainty over review of sunset clause for call termination charges, billionaire Mukesh Ambani's Reliance Jio on Wednesday announced it will charge customers 6 paise per minute for voice calls made to rival phone networks, but will compensate them by giving free data of equal value.

In a statement, Jio said the 6 paisa charge will remain in place till the time telecom operators are required to pay rivals for mobile phone calls made by their users to other operators' network.

These charges are not applicable on calls made by Jio users to other Jio phones and to landline phones and calls made using WhatsApp, FaceTime and other such platforms. Incoming calls from all networks will continue to be free.

Telecom regulator TRAI in 2017 had slashed the so-called interconnect usage charge (IUC) to 6 paise per minute from 14 paise and had said this regime will end by January 2020. But it has now floated a consultation paper to review whether the regime timeline needs to be extended.

Since voice calls on Jio network are free, the company had to bear the Rs 13,500 crore payment made to rivals such as Bharti Airtel and Vodafone Idea. To recover the losses created by the TRAI move, the company has decided to charge customers 6 paise per minute for every call they make to a rival's network.

This will be the first time that Jio users will pay for voice calls.

Currently, Jio charges only for data, and voice calls to anywhere in the country and to any network are free.

"...The consultation paper has created regulatory uncertainty and therefore Jio has been compelled, most reluctantly and unavoidably, to recover this regulatory charge of 6 paise per minute for all off-net mobile voice calls so long as IUC charges exist," the statement said.

For all recharges done by Jio customers starting Wednesday, calls made to other mobile operators will be charged at the prevailing IUC rate of 6 paise per minute through IUC top-up vouchers till such time that TRAI moves to zero termination charge regime.

"Jio will provide additional data entitlement of equivalent value based on IUC top-up voucher consumption. This will ensure no increase in tariff for customers," Jio said.

Jio said it has, in last three years, paid other operators like Airtel and Vodafone-Idea nearly Rs 13,500 crore as net IUC charges.

Reliance Jio announces Diwali offer: JioPhone price slashed to Rs 699

Reliance Jio has come out with a special offer for the festive season, offering JioPhones for a special price of Rs 699. The usual price of the phone is Rs 1500.

"This is a clear saving of over Rs 800 without any special conditions like having to exchange your old phone," said Reliance Jio in a statement about the the "JioPhone Diwali 2019 Offer",.

The company said it will also offer data benefits valued at Rs 700 to customers who buy the JioPhone during the offer period. "For first 7 recharges that the customer does, Jio will additionally add Rs 99 worth of data," Jio said.

With the Rs 800 savings on the purchase price and Rs 700 worth of free data, the company pegged the total benefits for JioPhone buyers at Rs 1500.

The company said the offer is aimed to woo 350 million phone users in India who are still on the 2G network. The company will look to come closer to its 500 million subscriber target through the offer.

Mukesh Ambani, chairman and managing director of Reliance Industries, said: “Jio will ensure that no Indian is deprived of affordable Internet and the fruits of the Digital Revolution. By offering the ‘JioPhone Diwali Gift’, we are making an investment of Rs 1,500 towards bringing every new person from the Bottom of the Economic Pyramid into the Internet Economy."

The company has announced the offer at a time when the JioPhone's sales is on the decline. According to Counterpoint Research released last month, share of JioPhone in the featurephone market had shrunk from 47 per cent in the second quarter of 2018 to 28 per cent a year after.

Reliance Jio has widest 4G network, Airtel's grows over 3-fold: Trai

Reliance Jio has the widest 4G network in the country with more than 7.46 lakh 4G base stations, according to Trai data.

Bharti Airtel's 4G coverage is less than half of Reliance Jio's but it has expanded its network more than three-folds since September 2017.

According to the data published by Trai in a consultation paper for reviewing deadline to end mobile call termination charges, Jio's 4G network almost doubled from 3.81 lakh 4G base transceiver stations (BTS) in September 2017 to 7.46 lakh BTS in June 2019.

Airtel's 4G network more than tripled from 97,130 BTS to over 3.26 lakh BTS.

Vodafone Idea holds the highest amount of spectrum that can be used for 4G services, around 1.5 times of Reliance Jio, but its 4G network grew only 62 per cent.

4G base stations now constitute around 60 per cent of the total network, which has grown from 5.91 lakh to 12.55 lakh within a span of two years.

2G network size in the country has now reduced by around 27 per cent to 4.79 lakh BTS from 6.61 lakh BTS in September 2017.

Similarly, 3G base stations have declined to 3.43 lakh in June 2019 from 3.6 lakh in September 2017, according to Trai.

Reliance Jio Infratel plans to raise Rs 25,000 cr for capex, retiring debt

Reliance Jio Infratel Private Limited, which is owned 51 per cent by Tower Infrastructure Trust, an Infrastructure Investment Trust, and rest by Reliance Industries, plans to raise Rs 25,000 crore to fund its capital expenditure and retire old loans. This fund raising exercise is separate from Reliance Jio Infocomm Ltd, which is raising funds on its own from both domestic and overseas markets.

According to a source, RJIPL manages and operates the tower assets of Reliance Jio. These tower assets have been recently transferred from Reliance Jio Infocomm. “The fund raising by RJIPL will be completed by the end of September quarter,” the source said. Of the Rs 25,000 crore, almost Rs 10,000 crore will be raised as commercial paper while the rest will be long-term debt.

Another Rs 5,000 crore will also be raised by Jio Digital Fibre Private Limited which is 51 per cent owned by Digital Fibre Infrastructure Trust, an Infrastructure Investment Trust (InvIT), with the balance stake held by Reliance Industries. Both Jio Digital Fibre Pvt Ltd and RJIPL have 20-year agreements with Reliance Jio Infocomm to meet the infrastructure requirements of the telecom giant. Both companies plan to repay their debt with assured cash flow from Reliance Jio Infocomm Ltd which will be the anchor tenant for both companies.

An email questionnaire sent to RIL spokesperson did not elicit any reply.

Reliance Jio Infocomm, a 100 per cent subsidiary of Reliance Industries, has recently undertaken a major restructuring of its assets, in which all the telecom tower and fibre optic assets, have been transferred to the two infrastructure investments trusts. Apart from these assets, Reliance Jio Infocomm will also transfer its debt worth $15.4 billion to the two trusts. This will reduce debt of Reliance Jio Infocomm substantially estimated at $26 billion.

As of now, the Tower InvIT is currently wholly owned by Reliance Industrial Investments and Holdings Ltd (RIIHL), which is the sponsor of the trusts. RIIHL, in turn, is the wholly-owned subsidiary of RIL. The Mukesh Ambani company is in talks with foreign investors including Canadian fund, Brookfield to invest in the InvIT. The valuation of the both InvITs has been pegged at Rs 36,000 crore.

The move will help Reliance Jio Infocomm to deleverage its own balance sheet and at the same allow the two InvITs to lease the tower and fibre assets to third parties to earn revenues. 

Jio races ahead of Airtel to become India's 2nd largest telecom company

Mukesh Ambani's Reliance Jio is now reportedly the second-largest telecom company in the country. The company is said to have overtaken Bharti Airtel in terms of customer base and now trails only Vodafone Idea.

While Jio presently has 306 million customers, Vodafone Idea continues to lead the industry with 387 million subscribers, according to a Times of India report. Airtel has 284 million subscribers. 

Jio, since its launch in Spetember 2016, has seen a meteoric growth on the back of aggressive and dirt-cheap consumer tariff plans.

On the other hand, Airtel, which dominated the Indian telecom space for almost two decades, is witnessing a dramatic fall. It was first overtaken by Vodafone Idea in the middle last year and now finds itself at the third spot.

In February, Jio had added 7.79 million subscribers, while Vodafone Idea lost 5.78 million customers, according to data published by the Telecom Regulatory Authority of India (Trai). Airtel lost 49,896 customers.

Over the past year, Jio's active subscriber market share has gone up to 24 per cent, gaining 9 percentage points (ppts), while Bharti has maintained its share at 32 per cent and Vodafone Idea lost 5 percentage point to fall to 37 per cent, according to a report released by brokerage firm CLSA this month.