Reliance Jio was slated to launch its highly anticipated JioPhone today. The budget smartphone, built in partnership with Google, was supposed to help Jio retain and upgrade its ageing feature phone subscribers to a smartphone, and also poach affordable 4G subscribers from rival networks. Its (almost guaranteed) disruptive pricing would provide Jio with a much-needed marketing tool to arrest its subscriber slide.

However, the launch has been delayed. Yet again. Our telecom reporter Pratap Vikram Singh reports that Reliance Jio is, instead, planning to only solicit ‘expression of interest’ from interested subscribers to get a sense of the demand for now. The company also declined to share details about pricing and tariffs. 

We’re republishing our May 2021 story detailing why Reliance Jio is in a tight spot. And why the JioPhone was going to be its saviour. We’re also making the story free to read for everyone, just for today, so do share it widely.

Last week, when Reliance announced its quarterly earnings, Jio Platforms—its telecom-to-tech arm—disclosed a quarter-on-quarter fall of 8.5% and 6% in its average subscriber revenue (ARPU) and overall revenue, respectively.

A year ago, though, Jio Platforms was on top of the world. 

Starting with a $5.7 billion investment by Facebook on 21 April, it went on to announce 12 successive investments over the next three months, culminating with Google’s investment of $4.7 billion. The total? Over $20 billion. That, too, at a time when funding had virtually dried up globally as investors and companies tried to make sense of the first wave of the Covid-19 pandemic and its impact on global economies.

Today, Jio is in the middle of a dangerous stagnation that risks becoming a downward spiral if it doesn’t do something drastic.

In August 2019, Mukesh Ambani, chairman of parent Reliance Industries, declared a subscriber base of 500 million was within sight, even as Jio crossed 340 million subscribers. That goal looked imminent since Jio had added new subscribers at the rate of over 100 million each year since launching in 2016.

But in 2020, that fell to 80 million. In the current year, that fall has accelerated further accelerated further The Ken Reliance Jio’s 500 million-user albatross Read more —Jio’s net subscriber addition over the last four quarters adds up to only 37.8 million.

Meanwhile, arch-rival and number two telco Bharti Airtel has been adding more subscribers than Jio every month since August 2020. Today, Airtel touts a lead of more than 11 million active subscribers over Jio, which is technically number one. Airtel’s average revenue per user (ARPU) has been consistently higher than Jio’s, quarter after quarter.

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Rohin Dharmakumar

Rohin is co-founder and CEO at The Ken. He holds an MBA from the Indian Institute of Management, Calcutta and an engineering degree in Computer Sciences from the R.V.C.E., Bangalore.

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