Taking on Reliance Jio, government-owned Bharat Sanchar Nigam (BSNL) has launched a feature phone with fourth-generation technology (4G) in partnership with handset maker Micromax for Rs 2,200.
BSNL will offer unlimited internet access, calling and SMS, along with free roaming, for a monthly recharge of Rs 97. Micromax says the effective cost of ownership will be Rs 3,364 after one year, as compared to Rs 3,336 for Reliance Jio's 4G feature phone. After two years, the cost of ownership for BSNL will be Rs 4,528 as compared to Rs 5,172 of Jio's and after three years, goes the claim, BSNL's ownership cost will be Rs 5,692 as against Rs 6008 in the Jio phone if kept by the customer.
Jio had in July announced a 4G feature phone for Rs 1,500, returnable at the end of three years for a full refund. The bundled Jio connection has a monthly plan of Rs 153.
With their 'Bharat-1' device, Micromax and BSNL say they aim at providing an affordable 4G phone option to the 500-plus million without an internet unconnection. It is also a dual SIM one and can be used with other operators, as the device is not locked with BSNL. The Jio phone is locked for three years.
Speaking on the occasion, telecom minister Manoj Sinha said the partnership with Micromax would increase BSNL's subscribers and strengthen the financial position. BSNL, which operates across the country except Delhi and Mumbai, has around 98 million mobile subscribers.
It plans to offer 4G services on the 2,100 MHz band, for which the company has pan-India spectrum.
Jio was the first telecom operator to tap feature phone customers with its 4G-enabled device. After rattling the incumbent operators with free and cheap offerings, it led the shift towards this segment of customers, with the market in big cities almost saturated.
Bharti Airtel, the entity with the largest market share, has announced a bundling partnership with another local handset maker, Karbonn, for a smartphone offer with an "effective price" of Rs 1,399. Vodafone and Idea Cellular are also in talks with handset makers for bundling partnerships.