Microsoft CEO Satya Nadella and Reliance Industries Chairman and MD, Mukesh Ambani, talk about how building tech intensity across organisations can benefit India’s economy and society. (Image courtesy: Microsoft)
Reliance Industries Chairman (RIL) Mukesh Ambani once again credited the company’s Jio network in playing a crucial role in bringing down the average data prices in the Indian telecom market. In a fireside with Microsoft CEO Satya Nadella held in Mumbai during the Microsoft Decoded event, the RIL chairman said, “The pre-Jio price of data in this country was between 300 and 500 hundred rupees. And for the poorest of poor people who use 2g the prices as high as 10,000 rupees. Post Jio, the price is between 12 and 14 rupees a GB.”
He also mentioned during the conversation that before Jio, the broadband speeds in India stood at 256 kbps, while now “21 Mbps on mobile data is the average speed available in every single village in India.” Jio which has 380 million customers has been a major price disruptor in the Indian market. Ambani made the comments when Nadella asked him about how digital will play a big part in the Indian economy in the coming years.
Satya Nadella in India: Read what he had to say at the Microsoft Decoded event
There’s no doubt Jio’s entry in 2016 is what started the price wars in the Indian telecom market with rivals Airtel and Vodafone-Idea forced to revise their packs to give daily data along with unlimited voice calls and 100 SMS per day to customers. Before Jio’s entry, consumers often relied on a separate dedicated data pack in addition to talktime for calls, but that changed drastically in 2016.
If one were to look at Jio’s existing tariffs, its basic plan of Rs 199 with 1.5GB data per day for 28 days amounts to 42GB data in total. The average price of 1GB data under this plan then comes to Rs 4.73. For Jio’s Rs 399 plan, which offers 84GB data in total (56 days validity and 1.5GB data per day, the average cost of 1GB mobile broadband is Rs 7.
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As Ambani noted in his remarks, the reduced cost has also resulted in increased usage of data across the country and consumption has gone up. “I can easily say that the mobile networks in India now are better or at par with anybody else in the world,” he added.
In 2019, a TRAI study had shown that average data usage per wireless data subscriber in India stood at 7.69GB per month in 2018. In 2017, this number was at 4.13GB per month. While the consumption is high, the average cost per GB of data usage stood at Rs 11.78 to subscriber, according to TRAI report. In 2015, the cost was Rs 226 per GB.
Another study done by Cable.co.uk, which compared mobile data charges across 230 countries in the world, for the period of October-November 2018, found that India had the cheapest mobile data plans at Rs 18.5 or $0.26 for 1GB. The global average price stood at $8.53 or around Rs 613 per GB, according to the report.
However, in December 2019, all telecom players had revised their data tariffs to increase costs, and while plans continue to offer daily data benefits along with unlimited calls, Jio has put restrictions on the calls made outside of its network and in some packs, it requires users to pay extra for these IUC (InterConnect Usage Charges).