Thanks to the Reliance Jio’s JioPhone, July 21 will go down as one of the most important days in the history of telecom in India and the world. Never before has a product or service come that could empower such a large number of people. In this case, it could change lives for over 50 crore Indians who are now using feature phones.
Mukesh Ambani might call it a smartphone, but at the end of the day the JioPhone is a feature phone. That is not dismissing it in anyway. This is a feature phone like none other, and for most of India that will now aspire for this phone, it will be a smartphone as Ambani calls it. The phone will come with free voice calls, unlimited data, access to apps, voice commands and even a cable link to stream content to any television. That is smart for anyone who has been stuck on a feature phone.
Clearly, Jio’s plan is to take away the two big barriers for people who want to own a better device. So the phone will be free, well in a way. By that Jio means there will be a one-time Rs 1,500 refundable security deposit for 36 months. The entire cost of using the phone with free calls and unlimited data (there’s a 500 MB daily FUP) will be just Rs 153 a month — if that is steep, there are weekly packages for Rs 54 and two-day packs for Rs 24 with same features.
If users want to stream video content from Jio apps to their TV at home, this package might be insufficient. Ambani suggests such users get the Jio Dhan Dhana Dhan plan at Rs 309 per month. This is a bait a lot of prospective users will not be able to ignore.
This is where Jio is thinking differently from every other service provider in the country. While most service providers so far have looked down upon the feature phone user, relegating them to 2G networks, horrible data access and text-only content, Jio is clearly thinking bottom up. They see video as the opportunity and the one thing that will make people opt for their faster data service over the existing service providers and services.
This means the average customer on a JioPhone, despite it being a feature phone, will become addicted to video and data. There is no feature phone user in the world who will come in this bracket at the moment.
Given India’s craving for video and provided Jio is able to offer stable data connections to the millions who will now come on board, this will be a digital revolution like no other the world has seen. It will virtually kill the 2G networks and service providers who are dependent on this old technology. It might kill off every feature phone maker, which is not able to produce a feature phone like the JioPhone. The large screen of the JioPhone, 4G VoLTE connectivity and a low price is something other feature phones don’t offer.
It is going to be an uphill task for virtually everyone else in the market, except of course the consumer.
Reliance has clearly laid a giant size bait with the JioPhone, one that could trigger a virtual exodus of users to their network. Remember, every other network mobile service provider in India needs the feature phone user to keep its volumes up. If they leave in hordes, it remains to be seen how many of them are able to survive.
Also, these are the users who are paying higher tariffs, not the smartphone users who are more demanding when it comes to rates. Survival could be tough. But the real impact of Jio so far has been its ability to make the competition improvise, and we have seen this with the great deals customers have been getting on data with the other networks. Now to see what they do to hold on to their feature phone users.