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Internet Era has just begun in India. More and more 1st-time internet users are joining the wave. Thanks (Or maybe no thanks because they created a monopoly in

Internet Era has just begun in India. More and more 1st-time internet users are joining the wave. Thanks (Or maybe no thanks because they created a monopoly in telecom sector) to Jio for making the Data rate too cheap and to manufacturers like Vivo, Xiaomi, and Oppo for making Smart Phones available at a cheap rate. (Less than 1$ for 2-3 GB.)

iso947 7y ago
Too cheap? Why is it a problem?
- thrwaway69 7y ago
  For one, most major telecoms have folded beside airtel. Rest of them are shrinking or have merged. Jio is a short term gain over long term problems most likely as they have started to creep up, internet speeds are once again abysmal, censorship and surveillance (why do jio apps collect so much data and need so many permissions?) Jio is when you can cannibalize an entire industry in a few years just because you have money to give out for free until everyone switches. I think India is pretty great for this kind of plans as you can see, they are quick to switch and have no loyalty to anything. If you can kill out all the competitors before they can compete, you win. Arguably, jio has improved many things and is a net positive so far but not for long enough. I won't claim anything on the specifics of government having connections with jio.
  - Retric 7y ago
    It’s a higher risk than you might think as new competitors can enter the market after they have lost their cash reserves and gained a bad reputation. That requires spectrum which might be an issue, but they are raising prices before their competition is bankrupt.
    - thrwaway69 7y ago
      Not in the telecom industry where it's pretty hard without A LOT of money and political power even when jio started. They also had previous experience and size to pull it off. They aren't going to make it easier for new competitors now.
deleted 7y ago
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denzil_correa 7y ago
> Jio for making the Data rate too cheap > (Less than 1$ for 2-3 GB.) Cheap is not the same as affordable. 1$ in India is equivalent to ~18 US$ [0]. [0] https://data.oecd.org/conversion/purchasing-power-parities-ppp.htm https://data.oecd.org/conversion/purchasing-power-parities-p...
- m-p-3 7y ago
  I wish it was that affordable then. Signed: A Canadian
- sseth 7y ago
  Actually these numbers are misleading - actual rates are much lower. For example, Jio has a Rs. 149 (2.1 USD) plan for 24 days for 1 GB per day. That works out to about 10 cents for a GB.
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sseth 7y ago
Well, it's not a monopoly by any stretch. Market share - Jio - 32%, Vodafone Idea - 29%, Airtel - 28%, BSNL - 10% as of Nov 2019. Yes - the incumbents (Vodafone, Airtel) have suffered a loss of market share and revenues / profits. Serves them right for keeping data rates high and not investing in modern technology when they had the money and market share to do so. I am sure customers in other markets would wish for real competition like this.
- signal11 7y ago
  The situation is much more complex than you describe. The telecom sector has been has been hit with arbitrary regulation and tax laws that have disproportionately impacted existing players. One of the reasons Vodafone has deferred investing is because of uncertainty around the massive tax burden in a 16-year long tax dispute because of a rule the telecoms department made up referred to as “Adjusted Gross Revenue”, which all providers appealed in the courts over years (and lost). It’s a huge tax that significantly eats into providers’ ability to invest. Faced with it, most other providers have simply exited the market. To add to this, the regulator is hand-in-glove with Reliance Jio, which is the new kid on the block and very well connected politically. Some background: https://thewire.in/tech/reliance-jio-telecom-regulation-trai-anil-ambani https://thewire.in/tech/reliance-jio-telecom-regulation-trai... Unsurprisingly the only mobile service provider doing well is the one which is well connected politically. Now the government is waking up to the shit-storm its policies have created, and are considering tax deferments for the existing mobile providers. In short, mobile services’ regulation in India has been very poor. And the outcome is that from 6+ healthy telecom companies, there is now one healthy company, one scraping by, and one ready to quit. I don’t believe customers in other markets would want this outcome.

iso947 7y ago

Too cheap? Why is it a problem?

thrwaway69 7y ago
For one, most major telecoms have folded beside airtel. Rest of them are shrinking or have merged. Jio is a short term gain over long term problems most likely as they have started to creep up, internet speeds are once again abysmal, censorship and surveillance (why do jio apps collect so much data and need so many permissions?) Jio is when you can cannibalize an entire industry in a few years just because you have money to give out for free until everyone switches. I think India is pretty great for this kind of plans as you can see, they are quick to switch and have no loyalty to anything. If you can kill out all the competitors before they can compete, you win. Arguably, jio has improved many things and is a net positive so far but not for long enough. I won't claim anything on the specifics of government having connections with jio.
- Retric 7y ago
  It’s a higher risk than you might think as new competitors can enter the market after they have lost their cash reserves and gained a bad reputation. That requires spectrum which might be an issue, but they are raising prices before their competition is bankrupt.
  - thrwaway69 7y ago
    Not in the telecom industry where it's pretty hard without A LOT of money and political power even when jio started. They also had previous experience and size to pull it off. They aren't going to make it easier for new competitors now.

deleted 7y ago

[deleted]

denzil_correa 7y ago

> Jio for making the Data rate too cheap > (Less than 1$ for 2-3 GB.) Cheap is not the same as affordable. 1$ in India is equivalent to ~18 US$ [0]. [0] https://data.oecd.org/conversion/purchasing-power-parities-ppp.htm https://data.oecd.org/conversion/purchasing-power-parities-p...

m-p-3 7y ago
I wish it was that affordable then. Signed: A Canadian
sseth 7y ago
Actually these numbers are misleading - actual rates are much lower. For example, Jio has a Rs. 149 (2.1 USD) plan for 24 days for 1 GB per day. That works out to about 10 cents for a GB.

deleted 7y ago

[deleted]

sseth 7y ago

Well, it's not a monopoly by any stretch. Market share - Jio - 32%, Vodafone Idea - 29%, Airtel - 28%, BSNL - 10% as of Nov 2019. Yes - the incumbents (Vodafone, Airtel) have suffered a loss of market share and revenues / profits. Serves them right for keeping data rates high and not investing in modern technology when they had the money and market share to do so. I am sure customers in other markets would wish for real competition like this.

signal11 7y ago
The situation is much more complex than you describe. The telecom sector has been has been hit with arbitrary regulation and tax laws that have disproportionately impacted existing players. One of the reasons Vodafone has deferred investing is because of uncertainty around the massive tax burden in a 16-year long tax dispute because of a rule the telecoms department made up referred to as “Adjusted Gross Revenue”, which all providers appealed in the courts over years (and lost). It’s a huge tax that significantly eats into providers’ ability to invest. Faced with it, most other providers have simply exited the market. To add to this, the regulator is hand-in-glove with Reliance Jio, which is the new kid on the block and very well connected politically. Some background: https://thewire.in/tech/reliance-jio-telecom-regulation-trai-anil-ambani https://thewire.in/tech/reliance-jio-telecom-regulation-trai... Unsurprisingly the only mobile service provider doing well is the one which is well connected politically. Now the government is waking up to the shit-storm its policies have created, and are considering tax deferments for the existing mobile providers. In short, mobile services’ regulation in India has been very poor. And the outcome is that from 6+ healthy telecom companies, there is now one healthy company, one scraping by, and one ready to quit. I don’t believe customers in other markets would want this outcome.