Jio seems to have decided for peace

All indications seem to be suggesting this.

  1. Jio recently decided to follow Airtel and Vodafone-Idea in raising the tariffs. Industry was not sure whether this would happen, as Jio may want to continue going aggressive in attracting customers from the competitors.
  2. Whereas Sunil Mittal (Airtel) has been calling for peace, for the first time Mukesh Ambani (Jio) has called for collaboration amongst all the players for the benefit of the customers.

Ambani in the inaugural address of the 2021 India Mobile Congress said, “If all the players in the industry work together, we can rapidly achieve a nationwide footprint of fibre, just as we reached mobile telephony to every corner of the country in the last decade”.

As expected, Mittal and Birla (Vodafone-idea) too matched the voice.

Mittal said, “We need to start to talk to each other, do co-builds like the world is doing, share more tower infrastructure and ensure that while we fiercely compete, we also collaborate and lower cost structures for serving most affordable tariffs anywhere in the world”.

Birla echoed, “As we accelerate this digital shift, we need to collectively address the need for continued investments to enable the journey to 5G, Industry 4.0 and beyond. A robust industry is necessary to invest and accelerate achievement of the Digital India vision.”

The events/ actions/ announcements all seem to suggest that worst competitive pressures are over for the Indian telecom industry.

Ambani seem to have realised that incremental gains may be more in co-operation than fighting. This also goes in line with his overall strategy for the Reliance group, wherein there is a clear focus on organising and creating value in every business including oil & gas, chemicals, retail, telecom and renewables.

Checkout Reliance’s key information section to gauge the overall sentiments.

Does that mean Jio cannot become aggressive again – obviously it can !

However, for now my base case scenario would be that it would not majorly. The focus would be more on bottomline and unlocking wealth for the Reliance’s shareholders.

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