Reliance Jio turned very
aggressive in their plan to launch impending 4G network. Loaded with fund which
they generated through Bond offering also offered them lots of confidence that
investors are positive about their plan.
In their quest of controlling end
to end user base, they aggressively launched their branded LYF device and
offering device bundled 4G data plan. Interesting step from their side but
seems they missed to learn their misstep which happened during their Reliance
Communication initial days when they offered bundled voice to end user to buy
out the user an in 2012 -2013, Reliance communications voluntarily disconnected
more than 20 million from their network and created a perception of one of the
network with lowest ARPU
Recently, post facing the problem
in pushing their low end LYF device with higher price range, Reliance
Jio slashed the device price by 25% but attached two riders with device
such as 2 year warranty and 3 months of free 4G. In my point of view and
understanding around the segment; Reliance Jio is repeating the mistake again.
The target segment of the device
is the entry level Smartphone user who is willing the experience of Smartphone.
In that category of user segment the average balance never cross INR 100 and
most are on prepaid model. Even though Reliance
Jio offer 4G free for first three months, I dont see the repeat
subscription of more than 5 to 7% from that category and APRU will not even $1.
I wish Reliance Jio and LYF team for grand
success in their strategy while I keep my finger crossed.
