The popularity of Lyf could persuade other Indian operators to look afresh at how devices and services are sold.

Gagandeep Kaur, Contributing Editor

July 25, 2016

2 Min Read
Can Lyf Bring Bundling to India?

Even before the launch of its services, Reliance Industries' devices unit, Lyf, had emerged as the third-bestselling mobile phone brand in the quarter ending in March 2016, with a 12.6% market share, according to Cybermedia Research.

Lyf trails Samsung Electronics Co. Ltd. (Korea: SEC) and Lenovo Group Ltd. (Hong Kong: 992), which have garnered market shares of 32% and 13.4%, respectively. Because it is a greenfield operator, Reliance Jio , the telco subsidiary of Reliance Industries Ltd. (RIL) , needed a new devices brand to help differentiate its voice-over-LTE (VoLTE) proposition. Yet RJio is also the only operator in the country bundling devices with services. Could its early success persuade other operators to follow it down the bundling route?

"There is excitement over free data, which Reliance Jio is offering along with Lyf [every Lyf device comes with three months of unlimited 4G data], and so some traction could be because of that," says Amresh Nandan, a research director for Gartner India. "Whether this strategy will work in long term remains to be seen."

"Service providers the world over are becoming more open to unbundling and moving away from subsidy-driven model," adds Nandan. "In the US, Sprint, T-Mobile and Verizon have already adopted this strategy [and] increasingly smartphones not bundled with voice or data plans are being bought.”

Want to know more about 4G LTE? Check out our dedicated 4G LTE content channel here on Light Reading.

Indian telcos have shied away from bundling because of their low average revenue per user (ARPU) and huge number of prepaid customers, with more than 90% of Indian subscribers on prepaid arrangements. Even efforts to push new technologies, like 3G and 4G, have not inspired Indian telcos to start bundling devices with services. Apart from offering Apple Inc. (Nasdaq: AAPL)'s iPhone along with their services, the incumbents have done little to explore bundling in India.

Nevertheless, given recent price reductions and the launch of RJio's network for the CDMA customers of Reliance Communications Ltd. , India's fourth-biggest operator, Lyf sales are likely to pick up. The adoption of Lyf devices also means that other manufacturers will probably make a bigger effort on VoLTE. Right now, most 4G devices are not VoLTE-enabled.

RJio's rivals will be keeping a close eye on the response to its recent moves. If Lyf continues to flourish, there could be some big changes in the way services and devices are sold to Indian consumers.

— Gagandeep Kaur, contributing editor, special to Light Reading

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About the Author(s)

Gagandeep Kaur

Contributing Editor

With more than a decade of experience, Gagandeep Kaur Sodhi has worked for the most prominent Indian communications industry publications including Dataquest, Business Standard, The Times of India, and Voice&Data, as well as for Light Reading. Delhi-based Kaur, who has knowledge of and covers a broad range of telecom industry developments, regularly interacts with the senior management of companies in India's telecom sector and has been directly responsible for delegate and speaker acquisition for prominent events such as Mobile Broadband Summit, 4G World India, and Next Generation Packet Transport Network.

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