Career
Government notifies National Apprenticeship Promotion Scheme
The government on Thursday notified the National Apprenticeship Promotion Scheme to offer financial incentives to employers.
 
"The Scheme has an outlay of Rs. 10,000 crore with a target of 50 Lakh apprentices to be trained by 2019-20. 
 
Union Ministry of Skill Development and Entrepreneurship in a statement here said that apprenticeship training is considered to be one of the most efficient ways to develop skilled manpower for the country. 
 
"It provides for an industry led, practice oriented, effective and efficient mode of formal training. The National Policy of Skill Development and Entrepreneurship, 2015 launched by Prime Minister Narendra Modi focuses on apprenticeship as one of the key components for creating skilled manpower in India," government said. 
 
The policy proposes to work pro-actively with the industry including MSME to facilitate tenfold increase opportunities in the country by 2020. 
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
 

 

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Reliance Jio's low data tariff, zero voice rate raises profitability issue
At a time when the Indian telecom sector is in stress, with the upcoming spectrum auction expected to add to the burden, the startling Reliance Jio announcement of zero tariff for domestic voice calls in perpetuity, with sharply lower data rates, has aroused questions about the revenue model and profitability of the new player.
 
"Customers should pay for only one service, either voice or data. Not both. The world over operators charge for only data while voice and messaging are essentially free," Reliance Industries Chairman Mukesh Ambani said in his much-awaited address to shareholders here, giving the rationale behind the move.
 
"The era of paying for voice calls is ending. Jio will usher India into a new era on the Jio network -- across India, to any network, always. And in the spirit of 'One India' - no roaming charges also. Jio will put an end to voice call charges in India," he said, amid applause from those at the 42nd Annual General Meeting of the company at a rather overcrowded Birla Matoshree Auditorium here.
 
This leaves Reliance Jio with just one option for charging subscribes -- and that is for data. The question over profitability kicks in all the more since Mukesh Ambani also said the base rate for data service will be at a discount of a whopping 90% over what the industry charges now.
 
With all this, he did not spell out how he proposed to rake in the money to justify the $21 billion investment. That answer from Reliance Industries has to wait. For now, even the Reliance Jio top brass is not wiling to speak on the subject, wanting the public to rejoice on the grand announcements made by their chairman.
 
Yet,what the company seems to be banking on is on volumes -- and variety.
 
For one, voice telephony will be bundled with data. So at the bottom of the pyramid, there is a price point of Rs 19 per for the occasional data user, then on to a monthly tariff of Rs 149 plan for the light data user -- going all the way up to a monthly Rs 4,999-plan for the heaviest data user.
 
The tariff announced also has to be read with two other factors -- the target he has set for his Jio team, and the push towards affordable devices.
 
He wants the team to quickly cobble up 100 million subscribers, against the current broadband base of of 150 million subscribers in he country. This apart, he said the prices of smart handsets under the company's LYF brand will start from Rs 2,999. The motto: Let no user deny himself/herself a Jio experience due to high price points of devices.
 
In fact, just ahead of Reliance Jio announcements, Analysys Mason -- a top global consulting firm focused on digital media -- said in its latest report that data tariff is pretty steep in India even by the developed nations' standards, and that there is scope for a 75% cut to push usage.
 
The consultancy said an average monthly increase in data usage to 10.2 GB at a discounted tariff of Rs 57 per GB, with 10% contribution from voice, will translate into a total increase in monthly average revenue per user of Rs 645. In Jio's case, the average tariff may be much lower without the 10-per cent contribution from voice telephony and a sharp cut in data tariff.
 
But the voice telephony for Reliance Jio is not the traditional 2G or 3G offering, but over the internet. This the chairman explained has its own dynamics. The company is also betting big on compelling applications and content, currently worth Rs 15,000 per annum, as also superior digital service experiences.
 
"The evolution of the mobile broadband market could have a significant impact on the voice market primarily due to cannibalisation of traditional voice revenues with voice-over-internet-protocol (VoIP) and other over-the-top applications," says Analyses Mason.
 
Initial reactions to the Jio announcements have focused mainly on how it could disrupt the market.
 
"The telecoms sector is currently reeling under financial stress, high debt burden and slowdown in revenue growth. Further decline in data tariffs may impact operators' profitability and sustainability," said Prashant Singhal, Global Telecommunication Leader, Ernst and Young.
 
In a somewhat similar vein, Tanu Sharma, Associate Director with India Ratings and Research, a Fitch Group company, said: "Reliance Jio may look to disrupt some of the prominent geographies of existing operators, leading to a re-distribution of the market share which is concentrated among the top three operators, in 2016-17."
 
The undercurrents are obvious. And given the complexity of issues -- and the variables at play -- few analysts have opted to hazard a precise guess on how exactly the Reliance Jio's grand plan will play out on the industry in general and the company in particular.
 
"The Jio start-up is looking at a minimum of five-year window to make profit as more and more users get on board while the company builds a complete Jio ecosystem," said Tarun Pathak, Senior Analyst, Mobile Devices and Ecosystems, Counterpoint Research.
 
Markets, though, have given their immediate verdict. The shares of Reliance Industries ended at Rs 1,029.15 on Thursday, down Rs 28.85, or 2.73%. But the fall was much steeper for the other two big listed players. Bharti Airel closed at Rs 310.70, down Rs 21.15, or 6.37%, while Idea Cellular ended at Rs 83.70, with a sharp cut of Rs 9.80, or 10.48%.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
  

 

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COMMENTS

JanataB

3 months ago

Currently 10MBPS is very good speed in many parts of india, if this is achieved with out interrruption then its fair for many users who are currently suffering from receiving good speeds in top cities and towns. check out jio speeds currently http://www.indiagrowing.com/Internet/Reliance-Jio-4g-speeds-K0O1283.html

V ganesan

3 months ago

when bharti came out ipo at around Rs.45 around 12 years back analyst doubted and questioned their capability and brougt down the price to around
Rs. 22 a fall of 50 percent from the ipo price. But the company emerged stronger. I STRONGLY BELEIVE THE SIMILAR think will happen now.I strongly beleive airtel will emerge stronger.

Amit Anam

3 months ago

50 per GB only availabvle for 3999 and 4999 tariff plan, that too If you opt for Rs 3,999 or Rs 4,999 pack, 1 GB 4G data will cost around Rs 66.65.


Read more at:
http://economictimes.indiatimes.com/articleshow/53958707.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Reliance Jio tariff plans would force telecos to slash tariffs: CRISIL
Reliance Jio announced ‘always’ free voice calls and proposed tariffs (20-30% lower data tariffs on low-end plans along with “always” free voice calls) that are quite aggressive. Effectively, by opting for Reliance Jio plans, the average monthly mobile bill for a mid-to-high end subscriber could come down by 50%-60%, as per CRISIL Research estimates. Reliance is betting on humongous volume play through a material increase in data usage to offset lower tariffs, points out CRISIL in its research note.
 
The research note continues it forecast on the industry by saying, “We foresee operators gradually moving towards simpler all-you-can-eat plans wherein subscribers would be offered unlimited voice and fixed data access for a lumpsum amount, rather than the forest of foggy options available today. Tariffs will tumble, and we project average data realisations halving to around Rs0.10 per MB by 2017-18 compared with around Rs0.20 per MB currently.” 
 
CRISIL analysts argue, “Clearly,  RJio  plan  aims  to  drive  up  consumption  of  data,  so  it  would  have  to  make available innovative, relevant and fresh content to subscribers on an ongoing basis.”
 
CRISIL’s forecast says that RJio’s aggressive entry will have far-reaching effects. The research note says, “Reliance Jio’s price aggression is expected to exacerbate pressure on both revenue growth and profitability of existing operators. Operators will not only be forced to relook at their tariff structures and customer retention strategy but may also be forced to bid more aggressively in the forthcoming spectrum auctions, especially in high revenue-generating circles where they have limited capacity and spectrum to offer 4G services.”
 
The research note concludes its analysis by saying, “Additionally, in the near-term, data traffic would migrate from incumbent operators’ networks to the free Reliance Jio network. We expect Ebitda margins for the industry to collapse by 250-300 basis points in 2016-17 and remain under pressure in the next fiscal as well.”
 

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