Reliance Retail, Telecom News, ET Telecom

The JioPhone Next is priced at Rs 6,499, but can also be purchased for an upfront payment of Rs 1,999 and a processing fee of Rs 500, with the rest to be paid in monthly installments over 18 or 24 months.

Bombay | New Delhi: The JioPhone Next smartphone, developed by the Reliance Industries-Google group, has “received an overwhelmingly encouraging response from retailers and customers” in both urban and rural areas, said Reliance Retail, which oversees the company’s sales. ‘device.

In its first comments since the launch of the 4G smartphone around Diwali, Reliance Retail told ET that there is no device on the market that is this feature rich available for an upfront payment of Rs 1,999. which he says has drawn millions of people to the handset.

The device comes locked with a SIM card from Reliance Jio, the telecommunications arm of Reliance Industries. Retailers are currently taking reservations for the smartphone and deliveries are expected to begin in the coming weeks.

“The market response for the Pragati operating system, in particular its voice, camera and language capabilities, has been very positive,” said Reliance Retail. The device is only available through JioMart Digital Partner retailers and these outlets “are rolling out at an accelerated rate across the country,” he said.

Pragati OS is the operating system co-developed by Jio and Google for the JioPhone Next.

The smartphone was launched just before Diwali with the aim of helping Reliance Jio target a large part of the more than 300 million featurephone users in India. The device is priced at Rs 6,499, but can also be purchased for an upfront payment of Rs 1,999 and a processing fee of Rs 500, with the remainder to be paid in monthly installments over 18 or 24 months.

Analysts had estimated the success of the new smartphone to be crucial for Jio, as it targets a user base of 500 million. The telecom operator lost around 11 million users over the July-September quarter to end the period with 429.5 million subscribers.

Some retailers and market monitors ET spoke to said the device faces challenges in the market, with prices affecting demand and adding to concerns on the supply side.

Analysts, however, expect Reliance to lower the price of the device as supply constraints including global semiconductor, ease, and component prices decline.

Vaun Mishra, analyst at Counterpoint Research, said the continued shortage of components is one reason for its higher-than-expected price.

“All OEMs (original equipment manufacturers) are facing shortages, including Jio, which can also affect its initial production. However, after the holiday season, demand will also drop, which could ease some pressure on inventories, ”Mishra said.

The launch of the smartphone was delayed from September to November due to component shortages.

Mishra said the price of the JioPhone was four times the price segment of the featurephone customer. Sanyam Chaurasia, analyst at the technology market research firm Canalys. He added that established brands such as iTel, Infinix and Realme “have already offered smartphones with decent financial / EMI options.”

“It will be very difficult to deliver the material quality expected by this mass market of 400 million people, as buyers have been using robust and well-built functional phones for at least four to five years and more without any after-sales service,” Chaurasia said. .

Manish Khatri, owner of Mumbai-based Mahesh Telecom, said “there is no demand yet” for the new device.

“We do not yet know how the device will be activated because there has not been a delivery yet. They didn’t provide training on how to turn off the device in case a customer misses the EMI, ”Khatri added.

Another retail executive, on condition of anonymity, told ET that retailers will get a 3-4% margin on the JioPhone Next’s sale price, compared to 8-12% for other brands. . “The operational expenses of running a store are high and lower margins will not work,” the executive said.

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