• Incumbent telecom operators following a new strategy to increase revenue. Things you should know

    It isn’t too long ago, we used to pay a few hundred or even more per month to get a handful of data. Yes, around 1 GB or so. But with the introduction of Jio 4G in 2016, the telecommunication industry saw a huge disruption, with multiple telecom companies closing down their shutters, and some even merged to offer the services to its users. We all know about it. So presently, the number of players in the Indian telecom segment is quite limited, and it consists of Jio and some other incumbent players like Airtel, Vodafone, BSNL, etc. And when there are limited players in the market, the recharge packs and the plans are available at almost the same prices whatsoever.

    Today, everybody who wants to use a lot of data on the go, and want to do unlimited calls, surely has a Jio 4G SIM connected, in on of the slots, which is the reason, Jio earned a lot of revenue in the last two years. But most users still keep their primary number, which, in most cases come from incumbent operators like Airtel, Vodafone, but they do not use the SIM cards a lot, and most of them are used to receive OTPs, getting incoming calls etc. As a result, the incumbent operators kept on providing the services, but they hardly got something in return. Yes, you got it right. People used to recharge their numbers with small amounts like Rs. 10 or so but used it for extended months.

    But recently most telecom companies switched to the subscription platform, where you will have to recharge your existing numbers with a minimum value to get service for one month or a pre-decided time. The companies actually followed Jio’s footsteps, where you have to recharge with a certain amount, however small it might be, to enjoy the services.

    telecom operators following a new strategy to increase revenue

    Why did the incumbent companies move to this subscription plan?

    With Jio offering such lucrative subscription plans, and the inability of the incumbent operators to get a decent amount of revenue by offering the services, the companies planned to move to the subscription plan to increase the average revenue per user (ARPU). This will ensure, the users will pay a certain amount of money at a regular interval, which will increase their income, if not it doesn’t lead to a booming incoming revenue that Jio did, in the first year of its commencement.

    Though it will lead to most users giving up their primary numbers and might port out to Jio or any other providers offering better value for money, there will still be some, who will not want to go through all the hassles, and keep their primary numbers active with a nominal subscription plan.

    What will it possibly lead to?

    There was a time, when people used two SIM cards, one for the purpose of making and receiving calls, send and receive messages, while the other was used for the purpose of surfing the internet. I am talking about most users. There can still be some exceptions.

    But with Jio, people started using a single SIM card for the purpose of making and receiving calls, sending and receiving messages, and also to use the internet. So the primary SIM card was hardly used, which eventually led to the incumbent operators run at a loss or enjoy lower profit margins than usual.

    But with the intention of increasing the ARPU, the users might ditch the second SIM card if they ever used one for the purpose of calling and messaging, and the second for accessing the data services. Things though might remain the same for users who use different SIM cards to keep the personal and work life separate.

    So the number of users using two SIM cards might see a drop in the coming days, with more incumbent operators moving to the subscription platform switching from the pay as you go option with the subscription plans.

    What should you do?

    If you are a user of a single SIM, whether it is from Jio, or from any other present operator, you don’t have to worry about it, as you are accustomed to using a single SIM card for all your requirements. But, if you are using two SIM cards, it might be the time, when you should take a decision.

    First case. If you are using two SIM cards, one for your work and the other for your personal requirements proceed with two SIM cards, as you were already paying for both the SIM cards and you will have to carry on with the same practice.

    But if you are using two SIM cards, where one comes from Jio, and your primary SIM card, which you do not use a lot, comes from some incumbent operator, it might be difficult for you to choose one of them, if you do not want to invest your hard earned pennies to maintain two mobile numbers.

    In such a situation, the first thing which you could do is, port out your primary number from the incumbent operator and choose Jio or any other operator, and ditch your existing Jio number. This is by far the best option you can go for. As your primary number might be connected to bank accounts for KYC purposes, and other requirements, and all your friends and family members already know it, ditching the new Jio number isn’t going to be a big deal for you. With the primary number, which is now switched to Jio or any other operator, you find pocket-friendly, you might end up getting a simpler life with one SIM card for both communication purposes and using the internet.

    But if the coverage of Jio in your area is good, and you do not want to port out of your primary number to Jio, the only option left in your hand is to recharge your primary number every month with the minimum subscription plan. Just in case you want to keep two Jio numbers, you should have a smartphone with dual VoLTE support, the number of which devices is quite low in the market.

    I have a primary Vodafone number and also use Jio. But now, I have taken the decision to ditch Jio and use Vodafone for all my communication and data requirements, as the prices are quite similar, and paying a little more to Vodafone is worth the pennies as the coverage of Jio 4G in my area is not outstanding if compared to that of Vodafone. Moreover, Jio depends only on 4G network, and Vodafone or other incumbent operators support 2G, 3G, EDGE and other legacy networks, which means, surfing on the go might not be a nightmare, which is in the case of Jio 4G.

    So that is the scenario of the telecommunication industry at present, and now, the companies offering the best plans will be the ultimate winner and time will say, which company will absorb the most customers.

    Even if people today switch from Jio to any other network, Jio is always a clear winner as it helped a number of users enjoy data services on the go, without any kind of hassles. Hope the information was helpful for you. What is your view of this decision by the incumbent operators? Let me know about your views in the comment section down below.

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