Reliance Jio subscriber growth slows, Welcome Offer could hurt company

Though the telecom regulatory authority of India (TRAI) has given the green signal to Reliance Jio’s plan of free voice calls for users, industry analysts have predicted that extending its Welcome Offer could hurt the company in the long run. And this might work in favor of other operators in the future.

At present, anyone can acquire a Reliance Jio SIM card at no charge. It comes with the Welcome Offer which allows users to consume data, send messages and make calls absolutely free of cost. The deal ends on December 31 and only those who lay their hands on a SIM before December 3 can avail of it.

Reliance Jio was hoping to gather at least 100 million subscribers by next month thanks to its unbeatable Welcome Offer. However, things have not panned out as expected. After a few weeks of excitement surrounding the launch in September, the enthusiasm for Jio SIMs appears to have piped down slightly, according to brokerage firm Motilal Oswal.

Reliance Jio SIM Card

Failure to meet its projected target has only encouraged Reliance Jio to ramp up efforts to gain more customers. It has begun delivering SIMs to customers’ doorsteps in Mumbai and Delhi NCR. Additionally, even if the company cannot legally extend its Welcome Offer past December 3, See why↗ it may still be able to bait potential users with a new but similar deal though.

HSBC analyst Rajiv Sharma, thinks this could put the telco in danger of being tagged a ‘discount brand.’ It might deter high- to mid-end consumers from moving towards it. Several folks from Reliance Jio have however dismissed this claim, reports ET Telecom. Apparently, a larger part of the company’s subscribers possess smartphones in Rs 4000 to Rs 20000 bracket.

Of course, Reliance Industries’ telecom arm hasn’t passed the litmus test yet – we’ve yet to see how many users it’ll keep after the Welcome Offer expires on December 31. As Bloomberg-Quint notes, the demonetization of Rs 500 and Rs 1000 notes has also affected the demand for Jio SIM cards. Also, heavy usage has kept the network quality poorer than promised.