JioPhone effect: Idea to launch 4G-enabled feature phone at Rs 2,500

Faced with the latest challenge of ultra-cheap 4G feature phone from Reliance Jio, Idea Cellular on July 28 said it is working with handset makers to bring down the cost of handsets.

However, the Aditya Birla Group company, set to be merged with bigger rival Vodafone, made it clear that it will not subsidise handsets.

"The practical solution that we are working on is to work with the handset industry and work with them to be able to bring down cost of handsets by bringing down the bill of material, so that the gap of the announced price of Jio feature phone versus a smart-phone can be brought down to reasonable levels," its Managing Director Himanshu Kapania told analysts.

Kapania said the ideal price point for a handset will be Rs 2,500.

In the past, the telecom operators had worked with handset makers when they were challenged by the then Reliance Infocomm's cheaper handsets, he noted.

"Given the fact that this (Jio announcement) has happened, and it is going to be distributed in large volumes, our belief is that we need to work with the handset industry and introduce similar phones in the marketplace," he said.

This will be an "affordable phone" which will allow customers the choice of dual SIM, selection of 2G and 4G networks, signing up with telecom operators of choice and to use applications of choice, he said.

There will be extensive market research on the number of features that can be brought down, operating system and whether it should have touchscreen, among others, he said. Read More