As expected, mobile internet prices in India have taken a steep dive. Telcos are preparing for the formal launch of Jio – a determined new entrant backed by India’s biggest private company, Reliance Industries.

Vodafone India, the country’s second-biggest mobile operator, boosted prepaid mobile data allowances by up to two thirds earlier this week, following similar moves last month by both Bharti Airtel, the market leader, as well as number three player, Idea Cellular.

Between them, the three leaders serve around 96 million mobile broadband subs, a ~68% market share.

These latest promos, targeting the bulk of their mobile broadband customers, are designed to protect Arpus and encourage more internet use, joining earlier offers of 4G connectivity at 3G prices aimed at the upper end of the market.

The incumbents, it seems, are keen to steer clear of an all-out price war, and with it the threat of commoditization, by persuading consumers to try out more digital services.

It’s a strategy Jio, currently in soft launch, may also follow when it makes its formal debut, thought to be weeks away.

As Jio vies to build its own ecosystem, Airtel, Vodafone and Idea have all been assembling in-house suites of branded apps.

All four operators offer VOD, as well as music, while all bar Airtel have live TV.

As competition mounts however, increased price pressure is unavoidable.

Media Ambition

Jio’s delayed rollout (launch was expected earlier in the year) has given the incumbents more time to protect their turf, reducing the newcomer’s potential impact. Nonetheless, Reliance will be a formidable competitor.

Jio has 4G capabilities in all of India’s mobile service areas (called circles), while the others only have partial coverage.

That sets the scene for further consolidation between the leaders and smaller operators, as a new distribution landscape takes shape.

At the same time, new content dynamics will come into play as mobile broadband subscriptions expand their reach, from under 10% per capita at the end of 2015 to over 40% by 2020, according to forecasts from Media Partners Asia.

The early winners will be ad-supported services focused on short-form video. For the majority of smartphone users in India, viewing will largely comprise clips and bite-sized formats for the foreseeable future.

At the same time however, the spread of WiFi and fixed line networks in bigger cities will lift up OTT viewing overall.

That heralds an inevitable shift in competition between established and new ways to watch TV, providing telcos with an opportunity to play a leading role.