Reliance Jio, India’s leading telecom operator, has emerged as the world’s largest consumer of mobile data traffic, surpassing China Mobile. According to Tefficient, a global analytics firm, Jio’s network handled a staggering 40.9 exabytes of data in the first quarter of 2024, compared to China Mobile’s 38 exabytes. This remarkable achievement underscores Jio’s dominance in the Indian telecom market and its rapidly expanding global presence.
Jio has also achieved significant milestones in 5G adoption. It boasts the world’s second-largest 5G subscriber base, with 108 million users. Notably, over 28% of its total mobile data traffic now originates from 5G users, highlighting the growing adoption of next-generation mobile technology in India.
Despite Jio’s impressive growth, its rapid subscriber acquisition strategy, fueled by JioBharat value plans and unlimited 5G offers, has impacted its average revenue per user (ARPU). Analysts anticipate that this trend will reverse in the near future as Jio implements tariff hikes, expected to follow India’s upcoming general elections in June.
Jio’s fixed wireless home broadband service, AirFiber, has also witnessed strong demand and record-high quarterly connections across 5,900 towns. AirFiber subscribers consume an impressive daily average of 13 gigabytes of data, surpassing JioFiber users by 30%.
However, analysts emphasize that Jio has not yet successfully monetized its 5G services, resulting in stagnant ARPU. The addition of low-cost JioBharat users and unlimited 5G plans are cited as contributing factors to the flat ARPU. Investment firms like JP Morgan highlight that Jio’s free, unmetered 5G plans drive nearly 30% of network usage but deter 4G data top-ups, encouraging price-sensitive consumers to switch to lower-cost plans.
In contrast to Jio, Bharti Airtel, its rival, has witnessed a rise in revenue despite lower average data usage (22.5 GB) and slower subscriber growth. Airtel’s ARPU increased from Rs 200 to Rs 211 (estimated) as its user base grew from 339 million to 350 million (estimated) in FY24.
Industry experts believe that tariff hikes are essential for all telecom operators to successfully monetize their 5G investments. Price increases are anticipated in FY25 and potentially again in FY26. Jio’s market share gains and superior 5G network are expected to translate into higher revenue once tariff hikes are implemented. The company’s partnerships with smartphone manufacturers, JioBharat phone offerings, and bundled services for businesses are also seen as growth drivers.
While Jio’s fiber-to-home and enterprise segments currently contribute a smaller portion of revenue, analysts at Goldman Sachs estimate it to be around 7%, indicating potential for future growth.
