Atrump Games

Atrump Games
Atrump Games

Airtel Adopting European & US Model to Attract iPhone7 Series Device Buyer's in India - Why Buyers Should Consider it ?

Post Reliance Jio 4G launch, Indian Telecom service sector is turning into strategic innovation center. The announced 3 months free services by Reliance Jolted Indian Mobile Service Provider segment. It is known fact that Indian wireless post paid userbase constitute around 5 -7% of total wireless user that  generate an ARPU in the range of $ 13 to $15. As per the analysis the creamy layer  buyers who buys premium devices comes around 4% of total wireless users.

It is the known fact that most of the 4G service providers will try their level best to attract high ARPU user to make the investment logical. We all are aware that Samsung is struggling currently on battery, brand image and left the premium segment half filled with their portfolio coupled with question mark on potential buyer about the safety of their product line.

Much talked about iPhone 7 and series launch offered an opportunity to Reliance Jio to collaborate them with Apple to capture high APRU user by offering end user 15 months welcome offer with unlimited voice, data, SMS, WiFi and jio digital services. I already wrote an article indicating the tradeoff of the collaboration for both Apple and Reliance Jio.

On a contrary, Airtel came out with disruptive plan by offering device at very low price. The European & US wireless service provider subsidized devices with lock in plan offer to end device user to ensure projected revenue for the lock in period. While creating the business case, they take the worst churn rate to ensure that they don't make losses.

Airtel collaborated with Apple and launched series of iPhone 7 device with different storage carrying different down payment attached with infinity plan. In my point of view, New or Replacement market will be attracted towards Airtel due to following reasons:

  • For Base iPhone 7 with 32 GB storage, buyers needs to do a down payment of INR 19990 whereas the actual cost of 59998 INR. In my point of view, the move will also attract Device buyers falling under mid level device buyer going for 20k and above which constitute around 15% of the total Smartphone market size.
  • User will be given an option to go for 12 month lock in with Infinity Plan with three options such as 1999/2499/2999. The three different plan will have different free data option but the lowest is 5 GB. As Airtel is aware of average data usages by premium user and used that learning to define the plan.
  • Once the lock in period is over then Device buyers may go for upgrade of the device or go for Balloon payment of 24000 to own the devices.
  • If one adds the cost which end device user will pay till the end with Balloon payment will be 63868 INR. The actual cost of device is without any plan is INR 59998. In that scenario, Device buyer will end up paying 3870 INR extra for availing data, voice and other services.
  • The device buyer will be paying monthly bill of INR 322 that translate as $4.8 when buyer opts for base pricing.
  • If buyer goes for highest plan then they will end up paying $15.79 for using airtel network.
  • Airtel will also offer some of its very popular music and gaming service for free.
  • We all know that Indian citizen always looks into the current status and they are used to pay EMI's. The attractive down payment price point for entry level device buyout is so attractive that it may cannibalize other brands.
  • Device user will not be forced to download multiple applications to avail the offers as compared to Reliance Jio services.
  • We are also aware that Apple received the overwhelming response on launch date which indicates that Samsung is going to struggle during holiday season as predicted by me in my earlier article.

The current offer from Airtel is limited to few cities as trial and based on the acceptability trend by end buyer as well as inventory availability, it will be extended to other cities.

The offer will also not cannibalize Apple Software services revenue. My recommendation is to grab the opportunity before inventory gets exhausted.

Related Articles :-

Related Videos :-

Get Reliance Jio Device from Flipkart and save Mobile Bills

Buy 3 G RAM Device If Thinking of Buying Reliance JIO SIM

Reliance Jio e-commerce plan

Airtel Slashed 4G Price By 80% : "Be Careful"

Reliance Jio Announce Tariff Plan : Free Apps | Voice Calls | 50 INR /GB Data

Reliance Jio Announce Tariff Plan: Biggest Loser | Government of India

Reliance Jio Target 100 Million Users : Great News For Users ( Hindi )

Why Reliance Jio Only Targeting 100 Million Users

Reliance Jio Announce Tariff Plan : Boom Boom For AirTel, Vodafone, Idea | Pain For Reliance Jio

Reliance Jio Pricing & Profit Blue's

Reliance Jio Content Offering - Will Eat Out User Data

Reliance Jio 1250 Free+ Content To User - Be Careful ( HINDI )
Share on Google Plus

About Devendra Prasad

20 years plus industry veteran of domestic and international ICT domain with the expertise in Business, Technology, Strategy and Analysis. Specializes in forecasting impact analysis, trends and recommendations for Investments, Technology and Regulations.
    Blogger Comment
    Facebook Comment


Post a Comment