India’s wireless operators wrote-off investments worth $40 billion to $50 billion in the aftermath of prolonged discount deals from Reliance Jio, Bharti Airtel chairman Sunil Bharti Mittal estimated.
In an interview with The Economic Times (ET), Mittal (pictured) said if a company in the US or Europe pursued a similar path to Jio’s strategy in India, regulators would likely step in to stop “predatory pricing”.
The executive pointed to losses across the sector largely attributed to Jio and its promotions: Vodafone, Telenor, Etisalat, Reliance Communications, Tata and Telenor are among the companies and investors impacted, he said.
Jio launched in September 2016 offering a free welcome deal, and since offered a number of free services and promotional discounts to entice new customers. Following its aggressive entry into the market rival operators called on regulators to intervene and have reported quarter after quarter of reduced revenue and profit.
Tussle at the top
In the wide-ranging interview, Mittal also welcomed rapid consolidation taking place in the Indian mobile market, describing the reduction of players in the country as something he “never thought possible”.
He added his company had benefited from the trend in the sector, even though a planned merger of Vodafone’s India unit with Idea Cellular would see the combined entity surpass Bharti Airtel in terms of revenue and customer numbers.
GSMA Intelligence figures revealed Bharti Airtel had a 24 per cent market share in terms of connections at the end of Q3. Vodafone held an 18 per cent share and Idea 16 per cent. Jio’s share was around 12 per cent.
Mittal told ET he expected Bharti Airtel to regain its leadership, in terms of revenue, in the financial year ended March 2019.