Atrump Games

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Reliance Jio Business Vs. Flipkart Business Model

Reliance Jio 4G service Operator crossed 100 million and darling of Telecom sector just like Flipkart used to be darling of e-commerce sector. Reliance jio invested more than $24 Bn of investor money to build state of class network to create best 4G network. Reliance jio bought user by offering free data and voice to end user just like Flipkart bought user base through cashback and discount. Both the organisation invested billions of $ in order to ensure that user traffic continue to grow. Buying a users by offering discount is nothing but shows that one don't have a confidence on their product or service line.

Reliance jio and Flipkart failed to understand completely that in India, anything and everything which carry free or discount tag attract all including rich. If one don't believe then they should visit malls when SALE goes on. I hope Flipkart understood the pain as they started loosing the battle when they reduced the discounting as well as poor quality of service. Reliance jio did not faced that problem till now as the service is free.

Reliance jio invested billions of $ for offering free service and it is ultimately their oil money which should go to investor pocket but got redirected to fulfil his vision. Reliance jio should tell investor that what is the interest payout they are doling out per quarter as well as cost of operation.

In similar way, we know the state of Flipkart as they don't have business model. In my personal opinion, Mukesh Ambani Reliance Jio will face tough time to be profitable for next 15 years given the debt level and current pricing. If they increase the pricing then incumbent is waiting for the same. Let me know readers view.
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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.
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