RCOM rings in sub-2k FM phones, Tatas too join party
Third Low-Cost Phone Launch within a Month for Reliance Communications
IN MANY ways, FM marked the return of the radio. Now, the market for cell phones with FM is hotting up and every player in the segment is reaching out to grab a sizeable portion of the cake. Two major players in the CDMA segment, Reliance Communications and Tata Indicom, on Monday made announcements on phones with FM.
“As many as 6 million mobile phones are sold in India every month. About 25-30% of these are FM-enabled. We are looking at a sizeable portion of this segment,” Reliance Communications president (personal business) SP Shukla told reporters over a video conference on Monday. In its third handset launch within a month, Reliance has launched two FM-enabled sets — Classic 261 and Classic 761. “Classic 261 has been priced at Rs 1,888 while Classic 761 will come at Rs 1,919,” he said.
Coinciding with RCOM’s launch, Tata Indicom repriced its model Tata Indicom Rythm with FM at Rs 1,299 as part of a bundled offer announced on Monday. Tata Indicom Rythm was launched for Rs 1,799 a few months ago. The basic offer, that was announced by Tata Indicom, bundles the handset — Haier D1600 with a colour display and FM—at Rs 1,099.
Tata Indicom on Monday claimed to have broken the price barrier once again, with its most affordable bundle offer in the country at Rs 1,099. Under this offer, along with the handset, customers get a free connection worth Rs 499 offering free incoming facility for a year, 1,500 minutes of free Tata-to-Tata calls.
Reliance’s Mr. Shukla pointed out that his company scored over competition on three points. “We are not competing on price alone. We have many more features and are well prepared. Our handsets are packed with features that are more than those being offered by any other mobile in the market today at similar price points. Second, we are a national operator, and third, we have a chain of after-sales service centres across the country,” he said.
“The backing of Reliance is there in our phones. Plus, we bring economies of scale on large volumes,” he added. Mr. Shukla said he was confident of the company growing its market share. RCOM now has over 30 million subscribers and is the second largest operator after Bharti Airtel.
The company seems to readying itself to take on Vodafone’s low-cost handsets, which the British giant is planning to introduce in India later this year.
Vodafone, which acquired Hutchison Essar last month, has announced it will roll out low-cost handsets priced at $25and $40, targeted at emerging markets such as India. While the operator is expected to provide some subsidy when it brings the handsets to India, the amount is not yet known. At current prices, Vodafone may sell its low-cost phones at around Rs 1,000 and Rs 1,600 respectively. Nokia’s lowest priced monochrome handsets come at Rs 1,699 currently.
Early last month, RCOM said it had sold 1 million low-cost handsets, priced at Rs 777, Rs 884 and Rs 888 within a week of their launch. Subsequently, RCOM rolled out colour phones beginning at Rs 1.234. The colour phones entered the market on May 18 and over half-a-million units were sold by the end of the month, Mr. Shukla pointed out.
“Our Classic range of phones have been extremely well-received by customers. With FM channels now available in all major cities in the country, our FM radio phones will provide not just mobile connectivity but also portable entertainment at very affordable prices,” he added.
The two models launched are SIM-based and customers can opt for any plan.
Mr. Shukla feels that its launch of FM enabled sets will convert GSM customers in favour of them. “These customers generally have higher ARPU. We will offer them higher value addition when they convert,” said Mr. Shukla.
“For mobile operators, music related value added services offer the highest revenue in the segment. These includes facilities like ring tones, caller ring tones,” he added.
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