Friday, 2 September 2016

Reliance Jio 4G Plans - A probable fraud

Reliance is company with profit as its stated prime objective and not a charity institution.

Consider the following points:

  • They had invested over Rs. 100,000 crores during the past few years and has to make profits, not running social service nor a charity.
  • Voice calls are not separately billed but consumes your data quota.
  • Much publicized Rs.50/GB is applicable for high end customers paying Rs.2,500 or more monthly charges. At low end it as much expensive as others or even more.
  • The hyped 4G GSM hand set at Rs.2,999 probably comes with lots of limitations and may turn out to be a paper weight especially for power users.
  • Notwithstanding its real intentions, Reliance Jio unleashing price war will definitely bring down mobile tariffs and consumer stands benefited.
  • In order to safeguard their customer base existing players will surely reduce tariffs and Reliance goal to rope in 10 crore customers might not happen so easily unless they address all customer issues in time. 
  • For majority rural & poor voice only users Reliance Jio means nothing. BSNL prepaid still is the best.
  • Existing players have invested several lakhs of crores won't close their shop and handover their customers to Reliance Jio so easily. They will invoke all legal and commercial fight with this predator.
  • Finally, the Regulator i.e. TRAI is duty bound to ensure level playing and protect from illegal activities of Reliance Jio and ensure existing players survive.
  • TRAI should examine pricing structure of Reliace Jio and if found its tariffs are with deliberate loss making and are aimed at pushing competitors into red and dissolution, severe penalties must be imposed on Reliance Jio.
  • Finally no one should be allowed to go into the level where competition gets destroyed and industry monopolized to protect consumers, in long run. That is the spirit of democracy. Competition is essential for competitive pricing, customer service, innovation and quality assurance.
While BSNL's CMD has stated that they have no choice except to match Jio's tariff by tariff to stay put in business and retain customers. Other TELCO's are yet to announce their plans to retain their customers. If they match Jio's tariff's they lose revenue and if they don't they lose customers and in both cases their bottom line would take severe beating. To stay in business they have to follow BSNL's strategy. No other way.

I would suggest to wait for Reliance Jio operations stabilize and once customer benefits are visible and quantifiable then only migrate considering all aspects. Never trust blindly, even if their past track record is good.

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