Reliance JioPhone Will Spurn Severe Net Neutrality Issues: Report

Reliance Jio Infocomm (RJIL) recently announced the JioPhone, a feature phone with 4G LTE & VoLTE support. The company is looking to disrupt the Indian telecom market yet again with the JioPhone because it’s priced at Rs. 0 (although Rs. 1,500 security deposit has to be everyone). And today, analysts say that the complete product details are not revealed by RJIL, which has become a worry for feature phone makers in the country.

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Several market research firms claimed that the JioPhone would cause net neutrality issues with the apps. At the moment, it’s unclear whether Jio will restrict the users with limited data per day for the Jio apps, and it’s even unclear whether the operator will count the data consumed by Jio apps under the data plan or not.

“We note that Jio already has an entire spectrum of apps spanning the social, content, payments verticals. Thus, a JioPhone user will likely have a very low churn both due to the ‘refund feature’ and the software platform,” Deutsche Bank said in the Deutsche Bank Market Research report.

Kotak Institutional Equities also said “Jio’s pre-installed apps on JioPhone can be seen as a violation of net neutrality principles, and we believe this aspect would be highlighted by competitors to the regulator,” in a report.

Speaking with Economic Times, a Jio Spokesperson revealed that “There is absolutely no question of the JioPhone violating net neutrality principles as users of the device will enjoy unrestricted access to the internet.” This essentially means that the JioPhone will come preloaded with its own app store, which has both Jio and non-Jio apps.

The ET report also cites that “Net neutrality backers said although on first look the model did not appear to be violating internet access rules, there wasn’t enough immediate clarity on whether the just-announced device will limit usage to select apps chosen by Jio.”

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Nikhil Pahwa, the co-founder of net neutrality campaign also spoke to ET on the same issue. He said, “The Trai ruling says no service provider shall offer or charge discriminatory tariffs for data services on the basis of content, which is clearly not happening in this case because this tariff is for the device (JioPhone) and not the content.”

“If Jio were to lock the SIM to a particular device, which was to limit users to a specific set of services determined by the company, then this would end up having the same effect as discriminatory tariffs for data services and be in violation of the Trai order (on differential pricing of services),” further added Pahwa.

However, Pahwa claimed that if Jio doesn’t count the data used by Jio apps in the data plan, then it would be a violation.

Another report from TelecomLead says that Indian Government is set to lose a whopping amount with the JioPhone. Because Jio is technically not selling the phone, instead it’s collecting refundable security deposit.

That said, Reliance Jio doesn’t have to pay 12% GST Tax for the Indian market, which would be a loss to the government. For example, if Jio manages to see 10 million phones, then the Indian Government will lose 180 crores. Jio is yet to respond all these claims on the JioPhone.

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[…] after Reliance Jio announcing the JioPhone, several industry analysts highlighted that the affordable feature phone will spurn several net n…. And now, two of India’s leading telecom operators- Bharti Airtel and Idea Cellular also […]

venz
July 24, 2017 10:40 pm 10:40 PM

The monopoly era of jio enters the telecom space one after another. I dont know what other operators were plucking?

liijjatpapad
July 24, 2017 3:58 pm 3:58 PM

looks like all Jio news have been covered for the year, what will be now in tt?tis another monopoly 😀

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