Reliance made headlines in India earlier this week with the launch of its cut-rate 4G service. The company's wireless carrier arm Reliance Jio offered customers an incredible package of lifetime free voice and roaming and unlimited data under the Reliance Jio (RJio) Welcome Offer. This is bound to spark a price war and some major carriers have already slashed prices. The already fierce competition in the Indian Wireless market is about to become even more so. Analysts predict that the company may not turn a profit for 4-5 years. Reliance appears to be playing to its strengths- with deep pockets and centralized leadership it is most likely to survive this war of attrition and capture a large slice of the customer base.
We thought we should take a look at the players in this market this week. As you can see from the chart, Reliance is a distant 4th when it comes to subscriber share. Bharti Airtel dominates with a quarter of the subscriber base. It has an incredible 254 million subscribers to Reliance's not insignificant 100 million. However, this is a snapshot in time. Telecom Authority of India's (TRAI) latest release shows that Reliance lost over a million subscribers in May 2016- highest of any major service providers and the decline has been steady. Small wonder then that Reliance delivered such a strong counter punch.
Another thing to note from the chart is that India's wireless market is fairly fragmented. There are 8 major providers compared to just 4 in the US (which maybe reduced to 3 if the US Justice Department changes its stance). Recent developments may precipitate consolidation with the weaker players being bought out or exiting the market. Time will tell which ones will survive. One thing is already clear however- with better internet speeds and cheaper service, customers will come out as winners.