Indian operator Reliance Jio has turned a profit for the second consecutive quarter, with its total earnings for the last financial year reaching INR7.23 billion ($108 million).
Jio launched 4G services in September 2016 and initially provided services that were so heavily discounted that they were effectively free. The operator is still adding subscribers, and in the latest quarter registered a profit of INR5.1 billion, following a loss of INR173 million in the fiscal Q4 2017. Across the last quarter, the operator’s revenue rose from INR68.8 billion in Q3 2018 to INR71.3 billion.
The operator saw its ARPU drop 11% to INR137 for the most recent quarter, but its average monthly data consumption per user was up to 9.7GB – the highest in India, and among the highest rates globally. Mukesh Ambani, chairman of Jio’s parent firm Reliance Industries, said that the firm’s daring business model had been proven by the strength of its financial results in India’s fiercely competitive market.
“A full-blown social, mobile and digital revolution is underway across the world, and I am glad that India is not being left behind in any way”, said Ambani. “Everyone at Jio is today proud to have played a pivotal role in transforming the digital landscape of this country and empowering millions of Indians with all the leading digital tools and skills.”
However, not all operators fared so well in India. Third-placed Idea Cellular saw its net losses for its fiscal 2018 increase tenfold, which it ascribed to “a seismic shift in the consumption of mobile services” caused in part by Jio’s strategy of aggressively discounting unlimited data bundles.
Idea has a 17% share of the market by subscribers. In its fiscal 2017, it registered a total loss of INR4.04 billion – its latest financial results show a loss of INR41.4 billion ($620 million) for the year ending in March. In addition, its revenue plummeted 20.5% to INR283 billion.
The operator cited the recent government-imposed reduction in terminal rates for both domestic and international calls as an aggravating factor in the market. However, despite these difficulties, overall usage was up, with per subscriber data use surging from 1.4GB in Q4 2017 to 7GB in the most recent quarter. Voice usage also increased from 412 to 577 minutes per subscriber.
Overall, Idea added 5 million subscribers year-on-year, with its total hitting 194.5 million. The group is anticipating its imminent merger with Vodafone India, which is awaiting final regulatory approvals. Currently, the operators are sharing around 49,000 mobile sites and will expand this with fibre and points-of-presence across 220 Indian cities.
While Idea’s fortunes were mixed, it retained its market share of around 17%, with Vodafone holding second place with 18%. Market leader Bharti Airtel maintained a steady 24% share, although it registered a 77.8% fall in profits for its fiscal Q4.