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War between Telecom freebies

Published: September 24, 2020
Author: G.Thulessiraman

Since a long time, there was a telecom war between the main service providing companies. Jio against Airtel, Vodafone idea and so on. The war went on for a long time but eventually reached at a standstill and all the companies relaxed.

The companies had a tariff increase in 2019, this increase in the tariff had been done after 3 years of consistent prices. To cover up the tariff increase, the telecom companies began offering incentives to the customer. These incentives were in the form of subscriptions to Netflix, Amazon prime and so on for attracting the customers.

The customers gave in to these incentives as the market’s nature was content hungry. Due to this pandemic situation too, with all the movie theatres being shut, people’s entertainment source has shifted online. This has led to a telecom price war of the freebies. Several big-budget films have also been released on these online streaming platforms.

Recently, Reliance Jio Infocomm Ltd came up with a new plan for the users who opt for monthly billing, the price of this new plan is Rs. 399. In this pack, the customers will receive 75 gigabytes of data, access to Netflix on a mobile device and one-year subscription of Jio movies and songs library.

According to analysts at Jeffries India Pvt, “Reliance Jio’s new post-paid plans offer more content and come at 20% discount.” Compared to Bharti Airtel. 75 gigabytes of data in combination with Disney + hotstar and a Netflix subscription is the plan offered by Bharti airtel at Rs. 499. While Vodafone Idea offers 40gb and does not offer any of the 3 online platforms.

Over the past 4 years, the number of users has shifted from buying monthly packages to a combo package. According to the analysts, Naval Seth and Sonali Shah at Emkay Global Financial Services Ltd,” This time extremely aggressive content offerings could be the key attraction for consumers.” They also expect Bharti and Vodafone Idea to follow Jio with similar tie-ups with OTT platforms to retain the monthly bill paying customers whose average spend monthly is higher than prepaid users.

After this news, Bharti Airtel has lost nearly 9%, while Vodafone Idea has fallen 12.7% in two sessions



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