The JioPhone was launched at the fortieth Reliance Annual General Meeting by RIL Chairman Mukesh Ambani. The most important aspect of a phone in a price sensitive market is how much you can get the device for, and the JioPhone is practically free. Jio users will have to pay a security deposit of Rs 1,500 to start using the device, and can get the money back by returning the device after three years.
At that price point, there is no other 4G feature phone in the market. The cheapest 4G devices start at around Rs 3,000. At the same time, the phone is bundled with a number of revolutionary features. There is a voice assistant that supports voice commands in 22 Indian languages. By availing for the Rs 309 Dhan Dhana Dhan plan, users get a special cable that allows them to connect the phone to any television, including the old CRT monitors and watch three to four hours of television every day. Long pressing the 5 button triggers an inbuilt safety feature that sends alerts to your near and dear ones. All of this is powered by a Qualcomm Snapdragon 205 platform, and KaiOS, a Linux based operating system.
The JioPhone addresses a number of pain points in the adoption of technologies that can deliver digital services such as banking, information, entertainment, healthcare and governance. These include the perception that plans are costly, unfamiliarity with smartphones, the high cost of 4G feature phones and a lack of local services and content available in regional languages. These barriers prevented the adoption of technologies across the country, and led to a situation of "digital disempowerment and unfairness", as Reliance refers to it. The JioPhone is the third part of a three step plan to address this issue, after extending connectivity and reducing the cost of telecom services.
One of the biggest problems with the adoption of internet plans was that the plans turned out to be expensive for first time users. If you have just got online, you are not likely to consume the entire quota of the data allocated to you by the plans, while you find your way around cyberspace and figure out what you need to use. For this reason, users in India were likely to not continue with internet services on their phones, after trying them out once.
The Telecom Regulatory Authority of India addressed this issue last year by extending the validity of data plans to a year. Jio's plans, which are among the cheapest in the market has pushed telecom service providers to reduce the rates at which they offer data services.
Jio has an advantage being a fresh operator as it was not burdened with legacy infrastructure which is expensive to replace. From the ground up, the Jio network was conceived as a 4G LTE network. The rollout came at a time when most of India consumed internet services through spotty 2G and 3G connections.
Google's Internet Saathi program aims to spread digital literacy in remote and rural parts of the country, but the problems faced in these regions is that the 2G connections are not always reliable, even though the Internet Saathis are provided with smartphones. By pairing an affordable device with a reliable internet connection, users will actually be able to start regularly using internet services when they need them.
The need for regional content and services cannot be stressed enough. Indus OS is the second most used smartphone OS in the country, and was the first to offer content and services in regional languages in India.
Jio is addressing this problem by bundling the phone with Jio applications including JioMusic, JioCinema, JioGames, JioKisan, JioPay and JioTV. JioKisan for example, is an application that allows farmers to sell their produce. Not all the applications are available in all the languages, but it is a start. Another problem this addresses is that a number of applications are pre-installed on the phone. Users in India may not have an e-mail address to sign in to an application store, or be aware of which applications they need as soon as they get their hands on a new device.
Over forty percent of the population of India cannot even afford a basic feature phone. The very young, the elderly and women are the most likely to not have access to their own phones. Most of the devices in the country are only used for sending texts and making calls. In India, around half of the mobile phone users do so through SIM cards and devices belonging to others. For such a price sensitive market, the price point of "free" is really attractive. The Rs 1,500 security deposit has been put into place to prevent abuse. As long as the JioPhone stays away from hidden charges, it should live up to the expectations people have from the device.
The feature phone form factor is practical for a number of reasons. From the elderly to the visually challenged, there are still a number users who are more comfortable with feature phones and a physical keyboard. The battery life offered by feature phones cannot be matched by smartphones. In areas with irregular power supply, smartphones are just impractical. By including rich content and services in a basic feature phone, and an affordable price, Reliance is practically providing life changing digital services to the poor in India, in same way the iPhone revolutionised smartphones in America.
The device bridges a gap between low cost feature phones and smartphones with rich services, and practically creates a new category of its own. With the integration of the safety feature and GPS services, the phone is about as cheap as the device can get. In fact, the mandatory requirement of GPS on all phones by the end of the year could mean that fewer people in India can avail basic communication services. The financial clout of Reliance may put pressure on rivals, such as Micromax, Intex and HMD Global.
The announcement of the JioPhone has caused a ripple effect in the market in India. A number of smartphone manufacturers are figuring out a way to introduce affordable 4G handsets in India. These include Lava, Intex, and Idea, which is in talks with manufacturers to bring down prices of 4G handsets. The prices may be reduced by not offering all the features provided by the chipset. The industry could also react to the JioPhone by offering low cost 4G smartphones.
The phone will begin beta testing with select users from 15 August. In the open market, the device will be available from 24 September in Reliance Retail and Jio stores. Pre-registrations for the JioPhone have already began.
Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd which publishes Firstpost.