4G price war: Telcos slash rates as Reliance Jio launch nears

Reliance Jio has already amassed 15 lakh subscribers for its 4G services and its Lyf-brand phones are now among the top three in India.

Telecom companies have taken note of what is going to hit them soon and are prepping up to defend their airwaves.

Some telecom companies have already slashes their 4G and 3G data prices in the range of 50% to 67%. Is this going to be enough?

On Friday last week, Idea Cellular said that it will give customers 45% more data with their current data packs. For instance, its 2G data pack priced at Rs 19, which offers 75 MB data for three days, would now offer 110 MB data for three days, a 45% more value to the customer.

India’s largest telecom company Airtel—on Monday—followed up with its offer to give a w hopping 67% more 4G and 3G data to its customers on their existing plans.

Under the revised data benefits, the Rs 655 4G/3G monthly recharge pack will now offer 5 GB data versus 3 GB earlier, an increase of 67%. Similarly, the Rs 455 pack 4G/3G pack now offers 50% more data by increasing data benefit to 3 GB from 2 GB. The Rs 989 4G/3G pack will now offer 10 GB data vs 6.5 GB earlier, offering 54% more benefits, the company said in a release.

A few hours later Idea slashed its rates by as much as 67% on 4G, 3G data postpaid as well as prepaid packs.

This has brought its rates to Rs 990 for 10 GB 4G, 3G data pack, its 2 GB data is now priced at Rs 349, as against the earlier price of Rs 449, while 5 GB of 4G, 3G data at just Rs 649.

Clearly, the threat from Reliance Jio is real and telecom companies aren’t feeling shy of undercutting each other to stay in the game.

Reliance Jio is currently offering 3 months of unlimited data on its LYF smartphones. It is further expected to offer 1GB of 4G data for as low as Rs 80.

Apart from its LYF smartphones, it has tied up with Samsung, Apple and HTC in offering 3 months of free data on their new phones.

The company is currently operating in the prepaid segment and is likely to start its services from August 15.

Even without the official launch the usage of average monthly data of users has increased by several times in the span of three months.

Reliance Jio has an average monthly consumption per user is in excess of 26 GB and is increasing rapidly, according to a Reliance Industries Ltd (RIL)'s Q1 FY17 financial report. This is an increase of 44.4% rise in data usage in from April 2016 where it stated that average monthly consumption was 18 GB per month.