Reliance JioPhone: The company maY
announce this change in terms and conditions for refund
MUMBAI: Reliance Jio Infocomm is expected to offer buyers of its 4G feature phone the option to return the handset before the stipulated period of three years and get part of the security deposit back.
People aware of the development said Mukesh Ambani-led Jio is likely to announce the terms of the refund scheme in the next few days. The feature phone, called JioPhone, will be available for beta testing from August 15. Pre-bookings for the handset will start from August 24. Jio did not respond to ET's queries on the matter.
The move to introduce more refund options comes in the backdrop of some analysts questioning if the JioPhone scheme - Rs 1,500 refundable after three years on return of the phone and an additional monthly tariff of Rs 153 - is attractive enough for widescale adoption of the new device, which the new telecom sector entrant is counting on to boost subscriber base.
Goldman Sachs, in a recent report, said subscribers who pay Rs 1,500 as deposit for three years for a phone and pay Rs 164 per month (Rs 153 for 28 days) are two mutually exclusive sets. It said the average revenue per user (ARPU) for most feature phone users in India is less than Rs 100, much lower than the Rs 153 a month that Relaince Industries is asking JioPhone users to pay every month.
"We note that churn rate in India is fairly high, at 3-5% per month," it said, and questioned if consumers will like to stay locked into one operator for three years.
Brokerage JM Financial said Indian mobile phone users have historically been lukewarm to the idea of getting their handsets locked to one service provider and, therefore, Jio may have to offer free service initially - maybe for the initial three-six months - to incentivise existing 2G feature phone users into buying the new device.
In its report post a Reliance Industries analyst call, Bank of America Merrill Lynch said the refund of Rs 1,500 on the phone will be lower if the phone is returned prematurely. "Jio may have options for upgrades of handsets," it said.
Brokerage Kotak said Jio's refund policy should answer questions like - what if the phone breaks down in the interim? Is there a minimum recharge compulsory for the refund? Should the handset be in working condition at end of three years? What is definition of 'working condition'?'
People aware of the development said Mukesh Ambani-led Jio is likely to announce the terms of the refund scheme in the next few days. The feature phone, called JioPhone, will be available for beta testing from August 15. Pre-bookings for the handset will start from August 24. Jio did not respond to ET's queries on the matter.
The move to introduce more refund options comes in the backdrop of some analysts questioning if the JioPhone scheme - Rs 1,500 refundable after three years on return of the phone and an additional monthly tariff of Rs 153 - is attractive enough for widescale adoption of the new device, which the new telecom sector entrant is counting on to boost subscriber base.
Goldman Sachs, in a recent report, said subscribers who pay Rs 1,500 as deposit for three years for a phone and pay Rs 164 per month (Rs 153 for 28 days) are two mutually exclusive sets. It said the average revenue per user (ARPU) for most feature phone users in India is less than Rs 100, much lower than the Rs 153 a month that Relaince Industries is asking JioPhone users to pay every month.
"We note that churn rate in India is fairly high, at 3-5% per month," it said, and questioned if consumers will like to stay locked into one operator for three years.
Brokerage JM Financial said Indian mobile phone users have historically been lukewarm to the idea of getting their handsets locked to one service provider and, therefore, Jio may have to offer free service initially - maybe for the initial three-six months - to incentivise existing 2G feature phone users into buying the new device.
In its report post a Reliance Industries analyst call, Bank of America Merrill Lynch said the refund of Rs 1,500 on the phone will be lower if the phone is returned prematurely. "Jio may have options for upgrades of handsets," it said.
Brokerage Kotak said Jio's refund policy should answer questions like - what if the phone breaks down in the interim? Is there a minimum recharge compulsory for the refund? Should the handset be in working condition at end of three years? What is definition of 'working condition'?'
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