Yesterday, Reliance unveiled the next phase of Jio, the Jio Prime service. After months of deliberation and legal drama, Reliance finally had to cut the cord on their “free services” that were causing major disruptions across the Telecom sector. The same free services are what have allowed Reliance Jio to garner a user base of 52-55 million Indians since they launched in September last year. However, come April 1, everything is about to change for the current Jio customers as the service goes into paid mode. Reliance has used a very interesting means of generating revenue for the company, one where you may be on the losing end.
Reliance Jio started their services with free voice calls, free text messages and free 4GB of 4G data per day, unconditionally. Post January 1, the data cap was made more restrictive, to 1GB per day as a means of improving speeds by reducing excessive usage. The speeds didn’t really improve by much, but the 1GB of data per day did rain on many users’ parade who were using their Jio connections as portable hotspots. April 1 onwards, there will be no such things as “free” on the Jio network as there will be a basic rental in place for both prepaid and postpaid customers.
The Jio Prime Subscription Sham
While there is nothing wrong with switching to a rental based plan, what feels ridiculous is the unnecessary “Jio Prime” membership. By coughing up Rs. 99 within the month of March, you’d be getting different benefits from a plan of the same denomination as a non-Jio Prime member. The only reason Reliance Jio has created this segregation is to force an influx of immediate revenue into the company’s coffers. Currently,the modest estimate of the subscription base sits at 52 million. In the best-case scenario, if everyone was to sign up for Jio Prime, that would result is an immediate revenue of Rs. 514 cores(52 million people paying Rs. 99 each). Even if only half the people subscribe to Jio Prime, that’s still a revenue of Rs. 257 crores.
What happens after April 1
Yesterday during our Facebook Live session where we talked about all the plans, people seemed to be very confused about what would happen post April 1. Regardless of whether your sign up for Jio Prime or not, unless you “recharge” your account with one of the plan amounts, your Jio sim will not work. There will be no free calls, no free messaging, simply because your number will not have any “validity” on it. The concept of “validity” is very interesting, as many telecom operators say that what you are paying for is to maintain an active service status on your sim (validity) but not for the actual service. For example, On Jio’s Rs. 303 monthly rental plan, you get 28 days of validity which includes free calls, free messages and 28GB of 4G data (which happens to have a cap of 1GB/day of use). Technically, if there is payment involved, there is no such thing as free. By paying Rs. 303 rupees, you will be able to make calls and exchange messages, along with having 1GB of 4GB data allotted to your number for 28 days.
What if you don’t sign up for Jio Prime
In case you decide that Rs. 99 is too much for you to spend, you’re going to be significantly short-changed in the future use. The plan denominations will remain the same, however, you get far less data allotment across the board. As the denominations go higher, the data allotment gets significantly lower for non Jio Prime users. For example, if you are a non Jio Prime user and sign up for the Rs. 499 plan, you only get 5GB of data with a validity of 28 days. On the other hand, Jio Prime subscribers get 56GB of data for the same price, the same time period, but with the catch that they can only consume a maximum of 2GB per day. This should be enough to convince anyone to jump onto the Jio Prime bandwagon.
The Fine Print
Reliance Jio has created plans so unreasonable that users will be forced to Join Jio Prime. In the event that you do, there’s a number of fine prints with the service. One such fine print that can be found on the Terms and Conditions section of the new plans states that “The user device may be used as a personal hotspot connection (this is also known as tethering) for upto 1 device only at a time.” Another states that “Unlimited SMS referred in the plan benefits will be capped at 100 free SMS per day in compliance with TRAI Regulations.” While these may not be deal-breakers for some users, there are definitely those who might not find the appeal in being restricted to tethering only 1 device at a time, given that other Telecom operators do not have this restriction.
The Prepaid Postpaid conundrum
This is actually very simple. You’d be making a poor financial decision if you opted for a Postpaid connection. The Reliance Jio website says that while prepaid plans are inclusive of all taxes, postpaid plan pricing is exclusive of said taxes. While the denominations are the same, a postpaid user will end up paying slightly more due to the added tax. Additionally, postpaid customers are mandated to setup and autopay/auto-debit system.
More misleading freebies
While subscription to JioTV, Jio Cinema, JioMusic and other Jio apps is free, any data consumed through these apps will be deducted from the data allotment as per the plan you are on. Essentially, browsing the catalog on those apps is free, but the minute you access any content, you pay for it through data. This is’n’t Reliance Jio’s fault, given that service providers are not allowed to favour certain content over others (Net Neutrality laws), however, advertising that you will have free subscription to those services but not explicitly mentioning that you’d still be charged data is kind of like “telling the selective truth.”
Overall, there is no doubt that Jio created a wave of excitement when it first entered the market. First, it gets customers accustomed to free services and once the audience has been drawn in, hits them with a compulsion to pay twice. Would it be fair if your favourite coffee shop started saying that in order to order to be able to order from their menu, you had not pay not just the cost of whatever you were ordering, but also a “fee” to make you eligible to order. While it is completely sound for Reliance Jio to charge for their service, what makes no sense is the forced creation of a “Prime” membership. While Reliance Jio’s data offerings have been generous, users have consistently reported slow speeds on the network despite not having consumed their daily limits. Airtel, on the other hand, was just announced as the fastest 4G network in India by Ookla, the company that created Speedtest.net.
With the announcement of these plans, we expect all other telecom operators to move their pricing around so as to address the competition that is Reliance Jio. As long as you buy a Jio connection before March 3rd, you have till the end of the month to decide whether you want to become a Jio Prime member or not or whether you want to even continue with Jio’s service.