Since its inception 2 years ago, Reliance Jio has built a stupendous user base and subscribers loyal to it. It has managed to create differentiation from its competing telcos. In such a short while it has generated several growth opportunities. All this has been possible because of the company offering free entertainment apps. Now that the telco is planning to soon migrate to a chargeable model, analysts predict several difficulties ahead.
The Free Content Hurdle
Mukesh Ambani led Jio has been offering free content to its users. And now that they are planning to monetise these apps, analysts foresee a huge challenge ahead of the telco. According to strategy analysts, moving entertainment apps from a free subsidised platform to a freemium model will not be easy for Reliance Jio.
There are several factors against Jio’s monetisation strategy. One is that India, according to strategy analysts, is not ready to pay for digital content yet. Another factor is that providing entertainment apps for free was the key driver behind Reliance Jio’s strategy to offer low voice and data costs.
Brice Longnos, an analyst with Strategy Analytics Wireless Media Strategies said that Jio used free content to successfully differentiate itself from the competition. This way they offered something different to the mobile subscribers, making their acquisition and subsequent retention easy. This is what made Airtel and Vodafone hastily quantify their content strategies.
The Monetisation Strategy
Strategy Analytics further added that to create a fruitful monetisation strategy, Reliance Jio needs to first identify the content that its users are open to paying. After that, the earmarked content needs to be integrated with business models and user experiences that match the targeted customer segment.
According to Nitesh Patel, Director of Wireless Media, “ Jio is investing in content and will expect its entertainment businesses to deliver revenue in the future. Whether it is a freemium or ad-supported business model, successful content distributors, including Jio, need to assess demand and willingness-to-pay for different types of content in order to (make) successful(ly) transition from free to freemium business models.”
Patel further added that Indian telecommunication operators need to work harder to monetise by the way of digital advertising if they want to leverage their subscriber data.
Also Read: Jio – PayTM Offers: Recharge Jio Number on PayTM to Avail Rs.1,500 Worth Coupons, Instant Cashback
Reliance Jio Building Content
To develop its content, Reliance Jio is leaving no stone unturned. The telco recently merged its digital music arm JioMusic with Saavn, its competitor. Jio integrated with the video platform Eros International as well. The company also recently finalised a long-term deal with Roy Kapur Film.
Besides all the above, the telco is leaning on its parent company, Reliance Industries’s media faction. RIL manages BIGFLIX; its OTT (Over-The-Top) video service. It also has stakes in several film and TV production houses and TV networks.
Competitors Beefing up on Content
Reliance Jio’s biggest rival in the telecom space is Bharti Airtel. Airtel is currently busy aggressively beefing up its content offerings. The telco is padding up Airtel TV and Wynk Music, Airtel’s music-streaming application, to broaden its reach to the highly-discerning 4G users.
The company is already offering Netflix and Amazon Prime Video subscriptions along with their high-value postpaid plans. Besides which, the telco has partnered with AltBalaji, Zee5, Hooq, Sony LIV, Eros Now, and quite a few more to provide exclusive content to its subscribers.
Jio GigaFiber
Additionally, Reliance Jio began accepting registrations for Jio GigaFiber earlier this month. Recently the telco offered a preview of its services. As an introductory offer for the Jio GigaFiber subscriber, the telecom company is offering 300GB of data free for the first three months. Essentially, the user will receive 100GB of data every month for the first three months, ramping up the total to 300GB.
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