India's telecom giants go 'over-the-top' in their latest offers
Offering video-on-demand platforms with post-paid packages can win them more subscribers
Mumbai: India's telecom price war is back, and this time the battle is being fought with freebies. After announcing the first tariff increase in three years in 2019, telecom carriers are offering incentives such as subscriptions to services from Netflix to Amazon Prime to win customers in a content-hungry market.
With theaters in India, among the biggest film markets globally by number of tickets sold, closed due to pandemic restrictions, the demand for entertainment content has shifted online. Several big-budget local films have been released on streaming platforms this year.
See More
- Bollywood stars in Hollywood: Farhan Akhtar, Alia Bhatt, Priyanka Chopra and other actors who are making a splash
- All the Emmy’s biggest surprises: Hazmat suits, Friends reunions and more
- Find out the unusual story behind Netflix’s ‘Enola Holmes’
- Winners list in key categories for the virtual Emmys 2020
On Tuesday, Reliance Jio Infocomm Ltd., the country's biggest telecom company by subscribers, launched a new 399 rupees ($5.4) plan for users who opt for monthly billing instead of pay-as-you-go packs. Besides 75 GB of data, customers would get access to Netflix on a mobile device and one-year subscription to two over-the-top apps and access to Jio's movie and songs library.
"Reliance Jio's new postpaid plans offer more content and come at 20 per cent discount" to Bharti Airtel, analysts at Jefferies India Pvt. said in a report. Bharti's comparable entry-level plan is priced at 499 rupees and offers the same amount of data but doesn't include access to Disney+ Hotstar and Netflix, while Vodafone Idea Ltd.'s plan offers 40GB data and doesn't include any of the three online platforms, according to analysts.
Over the past four years, the number of users opting for monthly billing of mobile services has come down sharply and such users now form about 5 per cent of the total 1.14 billion subscribers and generate 15 per cent of the sector's revenue, according to Jefferies analysts.
Although Jio introduced its postpaid plans in 2018, the company's offerings didn't see much traction, showcasing 'stickiness' of this base of customers, according to Morgan Stanley analysts. "This time extremely aggressive content offerings could be the key attraction for consumers," Emkay Global Financial Services Ltd. analysts said.
They expect Bharti and Vodafone Idea to follow Jio with similar tie-ups with OTT platforms to retain the monthly bill paying customers whose average monthly spending is higher than the prepaid users.