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'RJio's new tariff plans to help boost ARPU, good for industry'

Thursday, July 13, 2017

Reliance Jio's new tariff plans are an effort to improve profitability and thus a positive for the telecom sector that has been hit badly due to aggressive play by the new entrant, says a report.

"After amassing over 120 million subscribers, RJio is now focusing on pushing up the Arpu (average revenue per user) to improve its profitability," rating agency Icra said yesterday. The agency said the plan revision done yesterday is a positive for the sector as it points to a lifting up in tariffs and upping Arpu. The new plans are "attractively priced" for the subscriber and will "keep competitive intensity for the industry elevated," it added.

For the first six months since its September 2016 launch, RJio services were free, which impacted the sector very adversely with telcos reporting losses or dip in profits. After the free voice and data offerings ended on March 31, it came out with its maiden paid-for plans with the one offering 1GB of free data per day for 84 days by paying Rs 309, which translated into an Arpu of Rs 96, being the most popular, Icra said.

"These plans were offered to consolidate the healthy subscriber base, which the company had amassed during its free offer period," it said.

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