Jio has stirred up the telecom market with the launch of its cheap 4G Bharat Phone that threatens to wean away 100 million subscribers from rivals. The smartphone is priced at Rs 999.
The users will get unlimited voice calls and 14 GB of data for Rs 123 for 28 days. The annual plan will cost Rs 1,234 for 168 GB data.
The company plans to conduct a beta trial of 1 million Jio Bharat Phones starting July 7. The trial would be carried out across 6,500 tehsils to ensure scalability of the platform and processes, the telecom major said on Monday. BofA Securities said that the new plans are likely to increase the competitive intensity in the market.
A JPMorgan research note said that Jio has already become aggressive at the premium end of subscribers in March with the launch of postpaid plans and the latest announcement showcases its aggressiveness towards the lower end of the subscriber spectrum as well.
“Our initial interaction with the trade indicated that the price of Rs 999 announced by Jio is attractive and there are no 4G feature phones available at this price point, We heard that due to lack of availability of devices at this price point, low-cost 4G feature phones such as JioPhone are sold at a premium to their MRP in the market,” said a BNP Paribas research note.
“Jio Bharat is better placed to disrupt the market versus the original JioPhone in 2018, as it is a more-focussed product, has simpler value proposition and has better distribution and production planning,” said Emkay Global in a sector report.
“Assuming 40 per cent of 2G users shift to JioBharat, the impact on India’s mobile revenue for Vi/Airtel can be 11 per cent/8 per cent and the impact on EBITDA (earnings before interest tax depreciation and amortisation) can be 19 per cent/11 per cent,” the report added.
However, Kotak Institutional Equities said Airtel is unlikely to roll back entry-level price hikes, while Vi may take a more calibrated approach.
Vodafone prepaid plan
Vodafone has announced a new prepaid plan on Tuesday for users who need quick data recharge for a short time frame. Priced at Rs 24 and Rs 49, the new prepaid mobile recharge plans are titled ‘Super Hour’ and ‘Super Day’ data packs.
