Jio effect: Airtel may be launching a Rs 2,500 4G smartphone this Diwali

India's largest telecom operator Bharti Airtel in talks with multiple handset makers to bring a 4G smartphone for a price as low as Rs 2,500-2,700 to take on Reliance Jio.

While Mukesh Ambani-led Jio has announced plans to offer Internet-enabled feature phone for a refundable deposit of Rs 1,500, Airtel is placing its bet on a full-fledged smartphone as it believes people would be ready to shell out a little more to get a loaded handset.

A source familiar with the development said the new 4G smartphone - that will debut around Diwali - will come bundled with Airtel's 4G connection and "attractive" data and voice plan to woo mass market customers.

The planned dual SIM 4G smartphone will sport a four-inch display, dual camera, VoLTE calling and a longer battery life.

The Android handset will come with 1 GB RAM, said the source who wished not to be named.

He, however, did not say when the phones would be available for booking.

Reliance Jio had, in July, announced that formal bookings for Jio Phone would open on August 24, while the phone itself is expected to be available from September.

According to industry estimates, six million bookings have been recorded for JioPhone, that offers free voice calls and sms for life. Unlimited data offering comes for Rs 153 per month.
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28 hours a week: Indians spend 7X more time on smartphones than on TV

Indian  consumers spend as much as 28 hours a week on their smartphones, seven fold more than the time they end up spending in watching programmes on television as more users access internet on their mobile phone.

According to the Mary Meeker report, released on Wednesday night, the delivery of  entertainment, education, healthcare and marketplaces is being reimagined in India with the mobile phone emerging as the primary device for access to consumers.

In education sector, the report said education technology firm Byju’s has shown 15 per cent improvement in the quality of learning by accessing content on smartphones. In the healthcare sector, prices of laboratory tests have dropped by 50 per cent due to the aggregate inventory maintained by startups such as 1Mg and Portea. Customers made savings of around 20-30 per cent due to drug comparison on these platforms.

As far as payments are concerned, the unified payment interface (UPI) and use of Aadhaar is yielding results in areas such as the direct benefit transfer and instant money transfer schemes.

Users spend nearly half their time in watching entertainment content, while around 4 per cent of the time is invested on social networks and search engine sites such as Facebook and Google. News and media content remained low on priority at 2 per cent.

Around 4 per cent of the time is spent on online shopping from marketplaces such as Amazon and Flipkart.

This could potentially help Indian consumers take a gaint leap away from traditional formats as users stream content on their smartphones, aided by the massive rollout of 4G services by Mukesh Ambani-led Reliance Jio.

Launch of Jio in India has accelerated internet adoption by bringing down data prices to 17 cents per GB of data in March, from $2.7 in September last year.

People spend just two hours on print, a primary vehicle for consumption across India for decades, as multimedia content on smartphones account for a majority of their lives. Most of the content they consume is shared on platforms such as ShareIt and WhatsApp.

According to the report, there are around 355 million internet users in India, which is second only to China. Nearly 80 per cent of the useer access internet through their phones.
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Jio effect: Tata Tele's net worth erodes by Rs 11,650 cr

The woes of Tata Teleservices continue to mount with its net worth eroding by Rs 11,653 crore at the end of the financial year ended March 2017, on rising losses and interest payments.

The company announced a loss of Rs 4,617 crore for FY17, compared to a loss of Rs 2,023 crore in FY16. This is a bad news for its promoter, Tata Sons, which will have to keep investing in the company’s equity so that it can meet its liabilities, bankers said. But, the company’s debt stood reduced almost five per cent from Rs 30,192 crore in FY16 to Rs 28,766 crore in FY17.

Because of the price war in telecom spurred by the entry of Reliance Jio, the Tata group company’s turnover declined to Rs 9,419 crore in FY17 from Rs 10,588 crore in FY16.

The Tata group company is not the only one which struggled during the year. Aditya Birla Group’s Idea Cellular also reported losses of Rs 400 crore, compared to a profit of Rs 2,728 crore in FY16. Sales and profits of the top two players, Bharti Airtel and Vodafone, also declined during the year (See chart).

Bankers said they were not worried about Tata Teleservices’ debt service coverage ratio of 0.18 as Tata Sons always stepped in with funds to pay bank loans. The Ebitda (earnings before interest, taxes, depreciation and amortisation) fell to Rs 1,341 crore in FY17 from Rs 1,700 crore in FY16.

Jio’s launch, in fact, has triggered a consolidation among the current telecom players. Vodafone India, the country's No.2 telecom company in terms of revenues, and Idea Cellular have announced a plan to merge their operations in India, thus becoming the country's No.1 player. Bharti Airtel, India’s No.1 player, has merged smaller player Telenor with itself. Reliance Communications is awaiting the Supreme Court’s approval to merge its wireless telephony business with Aircel, thus reducing its debt by half.

The rising losses of Tata Teleservices may be a dampener for a suitor to buy or merge the company.

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