Reliance Jio now world's top mobile operator by data traffic, beats Chinese rival (2024)

India’s number one telco Reliance Jio has now emerged as the world's largest mobile operator in data traffic consumption, surpassing China Mobile.

The total traffic on the Jio network has reached 40.9 Exabytes compared with China Mobile’s 38 Exabytes during the January-March quarter, according to global analytics firm Tefficient.

Jio also holds the second largest 5G subscriber base globally at 108 million, with more than 28% of its total wireless data traffic now being consumed by 5G users, the company said in its analyst presentation.

To be sure, Jio’s average revenue per user (ARPU) also reflects the impact of subscriber additions of JioBharat phone users, who are value customers, and the unlimited 5G promotional plans.

Analysts say Jio's strong pace of user additions and consequent market share gains will augur well for revenue conversion in near term, as and when tariff hikes are undertaken. They expect tariff hikes of 20-25% soon after the upcoming general elections, which end early June.

Furthermore, demand for its fixed wireless home broadband offering AirFiber has been healthy across 5,900 towns, leading to record-high quarterly home connections, Jio added. Average daily data usage for AirFiber subscribers is at 13 Gigabytes, which is 30% higher than JioFiber subscribers.

But despite the record-high numbers, the telco is unable to move the needle on its average revenues per user (ARPUs) as it has not monetized 5G yet, said analysts. Addition of low-value JioBharat phone users and promotional unlimited 5G plans continue to weigh on its ARPUs which have remained stagnant for three continuous quarters, analysts added.

“Jio’s impressive 5G availability has driven successful 5G migration at promotional unmetered prices that is severely curtailing 4G data top ups and encouraging opportunistic price shopping to 1.5GB a day plans among price- sensitive consumers,” brokerage firm JP Morgan said in an analyst update on Tuesday.

Nearly 30% of Jio’s network usage is currently being given free of cost because of its unmetered 5G plans, the street said.

At the end of the fiscal year 2024, Jio has grown its total subscriber base from 449 million to 482 million, consuming on average 28.7 GB per user per month. But its ARPU has remained stagnant at Rs 182 as against Rs 181 at the start of the year.

This is opposed to Bharti Airtel, which is witnessing lower data usage (at 22.5GB at end of FYQ3) or subscriber additions, but is consistently recording an upward trend in its revenue. Its user base grew from 339 million to 350 million (estimated) in FY24, and ARPUs rose from Rs 200 to Rs 211 (estimated).

But, analysts maintain the increasing headline tariffs remain pertinent for all industry players to meaningfully monetize 5G services.

“We expect a tariff hike in FY25, as telcos are not earning the required rate of return and telcos will need a tariff hike to recover the 5G investment. We also see the possibility of another round of tariff hike in FY26,” Emkay Research said.

As for Jio, its market share gains will augur well for revenue conversion in near term as and when tariff hikes are undertaken.

“Superior 5G network, premium smartphone partnerships & JioBharat phone are driving the uptake of Jio’s services. The company is also doing partnerships with premium smartphone makers & strengthening market leadership,” Bank of America (BofA) Global Research said.

Its dedicated bundled offerings for small businesses across hotels, hospitals, manufacturing, and colleges are also driving growth in the enterprise segment, Emkay Research said.

Goldman Sachs estimates that Jio’s fibre-to-home and enterprise together contribute 7% to its previous quarter revenues. It is the largest wired broadband operator in India, with its subscriber base 43% higher than that of Bharti, it said.