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Smartphones at Rs500? Their true cost: Rs26,000 crore

What is the subsidy cost that telecom companies will have to bear to really deliver the devices at Rs500? An ET Prime calculation throws up a whopping number.
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rishitejpal
23 Feb 2018 3 Mins Read 2 comments
Manaska Mukhopadhyay
Manaska Mukhopadhyay
Indian telecom operators are at it again. Trying to kill each other through cut-throat pricing, that is. While the battle so far has been mostly about ramming down the prices of phone calls and data, it is fast spreading into a new territory: the price of your devices. In August 2017, Reliance Jio introduced JioPhone, a 4G VoLTE-based low-cost
scenario will offer users access to more content and will thus drive greater data usage. But the superior device-configuration requirements will increase device costs. "Considering the price point, such low-cost devices are likely to be highly resource-constrained, and if a lot of applications are loaded then the user experience might be impacted", says Anshul Gupta, Research Director at Gartner India.
Indian telecom operators are at it again. Trying to kill each other through cut-throat pricing, that is. While the battle so far has been mostly about ramming down the prices of phone calls and data, it is fast spreading into a new territory: the price of your devices. In August 2017, Reliance Jio introduced JioPhone, a 4G VoLTE-based low-cost scenario will offer users access to more content and will thus drive greater data usage. But the superior device-configuration requirements will increase device costs. "Considering the price point, such low-cost devices are likely to be highly resource-constrained, and if a lot of applications are loaded then the user experience might be impacted", says Anshul Gupta, Research Director at Gartner India.

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