Bharti Airtel, the country’s largest telecom operator, will not follow the new entrant Reliance Jio by launching a VoLTE-enabled feature phone, but believes that such developments will help customers consolidate their spending on one SIM. However, to counter Jio, the company will “aggressively” come out with more offers to ring fence its subscribers and grow market share. “We have traditionally and historically been of the view that the device market must be treated as an open ecosystem. We partner with all device makers. One of the things that we have stayed away from and we have no intention to get into is subsidising devices, manning the device inventories and running these devices like they belong to us. That is something we don’t like doing,” Bharti’s managing director and CEO Gopal Vittal said on an analyst call on Wednesday.
Vittal, however, added the the launch of 4G feature phone will open up a new segment. “We saw that the launch of low cost smartphones really opened up the 4G ecosystem. So we believe that this (Jio Phone) could propel growth of cheaper phones in the market and that is something that we embrace. We will work with all device companies to encourage this. As it happens, there is going to be increased SIM consolidation, which always benefits a leader like us because the customer then consolidates their spend around one SIM,” Vittal noted.
Last week, Jio launched its much-awaited 4G feature phone, which it will give free to subscribers, albeit with a Rs 1,500 security for three years. The company has also launched a monthly Rs 153 plan with free local and STD calls as well as 500 MB data every day. When questioned what Bharti will do to counter the Jio Phone, he said, “We will respond at the right time, but will not go for devise subsidy”.
Asked about whether revenues have “bottomed out” post the launch of Jio, Bharti’s CFO India and South Asia Badal Bagri said it is still “early” to comment and one needs to “wait and watch”. “I think its early days and will have to wait and watch. The full pricing effect of Jio is yet to come in to play. Also with the feature phone, we have to assess the situation over the next one or two quarters to figure out whether we are truly at the bottom of the market or not,” he added.
Vittal also spoke on Bharti’s VoLTE plans. He said sthe company, at present, is testing the service in five-six cities and will launch it across the country by the end of FY18.