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Data-giri Entry of the Disruptor

Reliance Jio

Alka Gurha

Reliance JioMukesh Ambani returned to telecom-land after eleven years with a big bang. His company, Reliance Jio promised cheaper data, 4G network, free voice calls, lower phone bills and faster internet speed that can change the face of India’s telecom industry. As Mukesh Data-bhai Ambani cast his network far and wide, his rivals went weak in their signals. Jio ensured that the Triple Play of Airtel, Vodafone, and Idea was compelled to change the rules of the game. You can’t sit and watch Reliance broadband-bajao you in public, can you?

With an investment of Rs1, 50,000 crore, Jio is said to be world’s largest startup. Truly wirelessly yours. Given that Jio announced lifetime free calling at a time when 70 percent of the revenues come from voice, how is Jio going push the boulder up the mountain? If unlimited data is as cheap as Rs 50 per GB for all times to come, how will the Jio model sustain once business houses lap up the offer? Too good to be true?

For one, Reliance has built humongous digital infrastructure (designed to handle 5G and 6G) and has enough bandwidth to assert its Data-giri. Experts say that Reliance has picked VoLTE (voice over LTE) 4G compatible Lyf phones in bulk that come with a Jio SIM. If you don’t wish to buy a new phone or a SIM card, the easiest way to jump on the Jio bandwagon is to go for a JioFi router for data usage. Moreover, experts say that the real story hinges on the Jio apps that are currently free for you to get addicted to.

While Reliance has created a capacity to take 100 million customers, initial users say Jio is in its beta stage where the speed is faster than Usain Bolt but the connection erratic. Once the initial interconnect glitches are resolved, we will know if Jio can assert its Data-giri or be compelled to revise plans. Or find itself in a hotspot.

According to Mr Ambani, “Two hundred years ago it was electricity that changed human life. Fifty years from now when you write history, one technology that would have changed civilization would be mobile internet.” He’s right. Humans have never engaged in an activity as dedicatedly as they have in mobile internet.

The arrival of Jio can change the telecom landscape in many different ways. Given that Jio is offering unlimited voice calling, other telecom operators are likely to follow suit. If voice calls are free, we could face a scenario where landlines could become as ineffective as typewriters. Which is where the dynamics of demand and supply comes into play. How is an average Indian residing in Lakhimpur going to use unlimited data? He can download movies, play games and watch songs but then what? As of now, there are limited avenues to fritter unlimited data!

With the telecom mavens promising a gradual but eventual shift to 5G by 2018, cheaper and faster data will create a new band of consumers. While the upper middle class users of Netflix, Wynk, and YouTube will continue to use data for shopping and entertainment, the lower middle class Hindi speaking consumer will demand content that suits his palate. There is a massive untapped market waiting for those who do not watch English TV shows. The probabilities are immense, the market huge and the potential beyond imagination.

But before that there is politics. And technology and politics seldom go hand in hand. While Jio promised the moon, politicians began singing the age old ditty of roti kapda aur makaan. Targeting the PM, one killjoy said that the poor need Atta (Wheat flour), not Data. Well, damning technology is unlikely to provide Atta. Embracing it can. But who wants an informed voter? An informed, connected voter is a politician’s worse nightmare. What if the farmers realize that affordable data can help them get information about boosting productivity? What if the farmers are educated enough to understand the advantages of digital farming? Thus began the suit boot jibes and the condemnation that the government is only for the rich. When it comes to technology, neither politics nor condemnation make for meaningful debate because the first doesn’t translate into good economics and the second is an outcome of the first.

Regardless, politics cannot stop an idea whose time has come. Reliance Jio can be a formidable brand if it creates value for customers and does not fizzle out like it did in 2005. Even though the name Ambani has long been the very definition of success, the prudent are holding the champagne. They will say cheers in January 2017. May the consumer be the winner!