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Idea to Rival Reliance JioPhone with 4G Feature Phone At Rs 2,500

The telecom operator is likely to tie up with handset makers, without locking them to a network. 

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Idea Cellular has been losing money over the past quarters, and Reliance Jio is the reason for that. But the telecom operator likes a challenge, which is why they intend on fighting Jio with its own version of 4G feature phone.

According to the company’s head, Idea Cellular will come out with a device that’ll be priced at Rs 2,500. For those unaware, Jio has launched its JioPhone which can be bought by anyone for a nominal three-year security deposit of Rs 1,500.

Keeping that in mind, and with Idea’s relatively lower 4G spectrum in the country, it is hard to see how the telco intends to offer the phone at such a price point.

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Idea doesn’t manufacture phones (Jio will partner with vendors for its own brand of devices), so we expect them to partner with multiple handset brands to ensure the pricing of the device remains closer to that of Jio’s.

Analysts have come to understand that Jio is heavily subsidising the price of JioPhone, which will not be done by Idea, as confirmed here.

The Idea 4G mobile phone will not be subsidised and we want to price it around Rs. 2,500.
Himanshu Kapania, Managing Director, Idea Cellular

Interestingly, Kapania pointed out that unlike JioPhone, which only lets you access few apps (locked by the telco), Idea’s phone will let users install whichever app they want.

Also Read: Idea Cellular Hit Hard by Reliance Jio’s Free 4G Internet Plans

Both the handset manufacturers and telecom operators need each other to make sure that the offering to the consumer is strong enough when you have to make a choice between a bundled offer and a telecom operator with a locked handset
Himanshu Kapania, Managing Director, Idea Cellular
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Idea’s drop in revenue, fall in user base numbers over the past quarter doesn’t bode well for the telco, and with its on-going merger with Vodafone likely to be finalised by 2018, Jio’s emergence only forces Kapania and Co to take drastic steps in order to fix the predicament .

Also Read: Vodafone-Idea Merger Given Nod By Competition Commission of India

Highlighting the current state of 4G smartphone users, Kapania stated that it’ll be interesting to see how consumers warm up to 2.4-inch Jio device, especially with internet users preferring phones sized at 4-inch or more. They’re also keen on pushing the prices down, without compromising on set of features made available.

We are looking at how much features can be brought down, how much bill of material can be brought down (to reduce prices) and test consumer response in each of these
Himanshu Kapania, Managing Director, Idea Cellular

It’ll be interesting to see how long before Idea or other telcos manage to replicate Jio’s handset plan, and will they succeed in the space, where Jio are likely to have a upper hand.

(With PTI inputs)

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