India’s most valuable company is in talks with domestic assemblers to make a version of its Jio phone that would run on Google’s Android and cost about 4,000 INR ($54), said the people, asking not to be identified since the plans are private. The inexpensive phones will be marketed with low-cost wireless plans from Reliance Jio, the parent company’s carrier, they said.
“We are of course trying to build our domestic companies. We have a sweet spot in entry-level phones,” said Pankaj Mohindroo, chairman of the India Cellular & Electronics Association, during an interview on Bloomberg Television. “The world has realized that India is a great place to do business and a great place to do manufacturing also.”
Reliance Jio and Google are reportedly planning to roll out more than 100 Mn low-cost Android smartphones, bundled with Jio data packs. Source told Business Standard that the phones could be in the market by December or early next year. The report suggests that the manufacturing of phones would be outsourced to homegrown vendors, with Reliance already in talks with some of them.
“Jio has an opportunity to target more than half-billion Indians who don’t own a smartphone and trigger a blue ocean market opportunity,” said Neil Shah, research director at Counterpoint Research. “With Reliance expected to work with Indian vendors, Chinese brands will lose out on a potential opportunity and market share.”
Reliance in July struck a broad alliance with Google, in which the Alphabet Inc. unit would invest $4.5 billion and cooperate on technology initiatives. The partnership is still under regulatory review so Reliance is proceeding with the mobile phone initiative on its own for now.
Representatives for Reliance declined to comment
Reliance's target of selling 150 million to 200 million phones over two years would represent a massive boost for local factories. India assembled an estimated 165 million smartphones in the year ended March, and about an equal number of basic feature phones, according to Mahindra’s association. About a fifth of the smartphones cost less than 7,000 rupees, or about $100.
Key differences & goals for outstanding
- Their feature phones keep them excluded, even from the basic uses of the internet at a time where both India and the rest of the world are standing at the doorsteps of 5G telephony.
- If Reliance succeeds in popularizing the new gadget, it could lift the prospects for Jio Platforms, accelerating Ambani’s efforts to build an empire spanning e-commerce, social media, and games.
- Many of Jio’s nearly 400 million users use no-frills second-generation devices, paying $2 monthly for voice and data — a large potential market for the new device.
- It could eventually erode the market share of Chinese phone makers such as Xiaomi.