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Indian Feature Phone Market Ready To Experience A Business Shakeup Due To Jio Impact

| Published on July 24, 2017

With Jio coming in business in past few months the telecom market has seen a lot of ups and downs. The using of unlimited 4G data though was free but it actually aimed at wiping off competition in the market first like Airtel, Docomo, Vodafone etc.

Last few years Indian Telecom Market has seen a lot of turmoils due to huge competitive market.

During this period the contribution of telecom services to GDP has declined from 2% of GDP in FY09 to just 1.2% in FY17.

Well, Reliance Jio has definitely set up a landmark and created a strong base in the market. But things shape up worst for other feature phone brands as Ambani announces free Jio 4G Volte smartphone. The market analysts and industrialists look at it a huge danger for the market of other companies.

Indian feature phone brands like Micromax, Intex, Lava and Karbonn and Samsung are in the threat zone. As Jio announced the phone free of cost with only the users expected to deposit Rs. 1500 which is refundable after three years. With such great features and cheap plans, other brands too have to make plans or lower their budgets to come up in the competition.

Most of them already have their own 4G devices but adding more features like apps, Television connected to mobile, safety button and so on makes Jio Phone stand out. They thus have to rely on making more partnerships in order to level up with such a competition in the market given by Jio.

But few people have other views. Definitely, such a competition will bring out the best in Indian Telecom market. Imagine most of the users shifting from 2G to 4G services. That’s huge. People will look forward to settling for better at a cheap rate. Though rates will decrease the number of population involved increases. The rural areas can also have a hand on such cheap services thus expanding telecom market.

Reliance said it will make available 5 million phones every week and manufacture all units in India. With already millions of users the user base will increase.

Who Said What?

Vikas Jain, the co-founder of Micromax Informatics, said,

“This is a disruption … it will shake up the ecosystem …We definitely cannot rule out the fact that this will impact the feature phone industry, but difficult to figure out the scale of the impact. For instance, we don’t know whether that Rs 1,500 upfront fee is being financed”

Rajan Mathews, Director General of the Cellular Operators Association of India (COAI), said,

“It is one category which has seen least innovation over the years. There will be significant impact on Indian players”

Jain from Micromax said,

“Going by the specs of the phone, I foresee it as a smartphone launched at an extremely consumer friendly price, rather than a feature phone. So it could bring consumers on this ‘feature phone’, but propel them to use smartphones later on”

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