RJio Disrupts Again With Low-Cost 4G Phone

India's Reliance Jio has launched a keenly awaited 4G handset that could bring lower-cost 4G services within reach of millions of Indian consumers.

Announced today at the annual general meeting of parent company Reliance Industries, the JioPhone requires consumers to put down a deposit of just 1,500 Indian rupees ($23.30), which can be claimed back three years later on returning the device. (See India's Jio to Disrupt (Again) With Low-Cost 4G Phones .)

Effectively, that means the Reliance Jio handset costs a consumer nothing. "JioPhone is a truly revolutionary phone that will transform the lives of 50 crore [500 million] feature phone users," said Mukesh Ambani, the owner of Reliance Industries.

For as little as INR153 ($2.30) every month, subscribers will be able to make as may calls as they like and access mobile data services. "There will be a fair usage policy of half a gigabyte per day, to ensure that bandwidth is fairly apportioned for every user," said Ambani. "Reliance democratized the equity culture in the past. Now Jio will democratize the digital culture in India. Digital Life will no longer be the privilege of the affluent few."

The JioPhone device itself is to be manufactured in India in keeping with the government's "Make in India" policy initiative, according to Ambani. The plan is to make it available from user testing from August 15 and for "pre-booking" from August 24 onwards. Devices features are to include near-field connectivity, four-way navigation, an alphanumeric keyboard, a memory-card slot, a microphone and FM radio. The phone will also come pre-loaded with applications like Jio Cinema and Jio Music.

Ambani has emphasized that about 500 million of India's 780 million mobile devices are feature phones that cannot be used for accessing the Internet. The launch of the JioPhone, therefore, could effectively put an end to the 2G feature phone market in the country. It could also address a major impediment to the expansion of India's mobile broadband market -- the typically high cost of smartphones.

The launch could also boost customer numbers on RJio's network. Having now signed up about 125 million customers, RJio is looking at ways to get to the next 100 million. Device makers, meanwhile, will be under pressure to innovate.

Above all, the JioPhone looks sure to have an impact on the profits of incumbents including Bharti Airtel Ltd. (Mumbai: BHARTIARTL), Vodafone India and Idea Cellular Ltd. With the launch of the JioPhone, those players may have to develop new strategies for customer retention. Even today, a significant number of an incumbent operator's subscribers will be on 2G-only deals.

For all the latest news from the wireless networking and services sector, check out our dedicated Mobile content channel here on Light Reading.

Ambani also used the occasion of the annual general meeting to provide an update on fixed-line services. "Creating fixed-line high-speed broadband services is the next leap forward for our country," he said. "RJio remains well on track to bring world-class optic-fiber connectivity to enterprises, small businesses, homes and public spaces. Most of Jio’s infrastructure for providing these services is already in place. This is the next big monetization opportunity for Jio."

Ambani also claimed that Jio's 4G footprint will be greater than the 2G coverage offered by other telcos. "It took 25 years for our competitors to build a 2G network," he said. "RJio will have created a larger 4G network in just three years. RJio services will cover 99% of our country's population in the next 12 months... we will soon have over 10,000 RJio offices across every city and tehsil town of India [tehsil towns are administrative areas in India]," says Ambani.

— Gagandeep Kaur, contributing editor, special to Light Reading

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