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Mukesh Ambani, India’s richest man, is introducing a new model of internet-connected mobile phone for $12 in an effort to disrupt the market for phones that are used by approximately a quarter of a billion people.
Ambani’s cheapest entry into the market for non-smartphone “feature” phones, which are used by approximately 250 million people in India, is the “Jio Bharat” phone. According to Ambani’s data unit, Reliance Jio, it will initially be trial-based.
The product, which is sold for Rs999, or $12, is the latest disruption from Jio, which is backed by Google and Facebook. In 2016, Jio changed India’s mobile telecoms industry by introducing super cheap voice plans and data plans that were initially free. The move sparked fierce competition, resulting in Jio and incumbent Bharti Airtel effectively controlling the mobile market with the fastest growth rate in the world. Jio is a subsidiary of the conglomerate Reliance Industries.
According to Jayanth Kolla, founder and partner of Bengaluru-based Convergence Catalyst, Jio’s pricing strategy “made it clear they were going for every Indian out there.”
According to Kolla, Jio’s most recent move is “mopping up” customers with the lowest incomes who have previously been discouraged from getting online by out-of-reach prices. “Twenty percent of India’s [data] subscribers are still on feature phones,” Kolla stated.
Ambani, chairman of Reliance Jio, stated: In spite of the fact that the world is on the verge of a 5G revolution, 250 million mobile phone users in India remain “trapped” in the 2G era and are unable to use even the most fundamental internet features.
The Bharat, which is a name for India in various languages, is not Jio’s first phone. In 2017, the company introduced the 4G-enabled feature phone JioPhone, which cost Rs1,500 and was returnable after three years.
In addition, Jio produced the Android-enabled JioPhone Next smartphone in 2021 after Google’s parent company Alphabet invested $4.5 billion to acquire a 7.7% stake in the company in 2020. However, this smartphone was only sold online and was less of a commercial success, costing Rs4,499.
Within India, Jio will offer a monthly plan that includes 14GB of data and unlimited voice for Rs123 ($1.50). In contrast, Bharti Airtel, a rival, currently offers a plan with unlimited calls and 2GB of data for Rs179 (about $2.18).
Reliance’s own video and music streaming apps, JioCinema and JioSaavn, as well as digital payment capabilities with India’s UPI network and a camera, will be included in the Jio Bharat, which will be manufactured in India. Despite the fact that Imprint Zuckerberg’s Meta purchased a 10 percent stake in Jio for $5.7bn, WhatsApp and Facebook are not at present accessible on Jio Bharat.
Prabhu Ram, CyberMedia Research’s head of industry intelligence, stated, “The 2G to 4G conversion in India remains key for the ongoing digital transformation.” Ram went on to say that Jio’s new phone was a “step in the right direction” in expanding Jio’s reach to customers “at the bottom of the pyramid,” but he also warned: It is not yet clear assuming Jio’s endeavors . . . increase sales among customers.