By Pratik Chourdia
If you think #Jio Phone is Free, here are possible facts
- RIL earns interest on your Rs 1500 deposit, consider Rs 150 a year and Rs 450 in 3 years
- Internet package revenue around Rs 150 from each phone, that is Rs 1800 per year revenue . If 10% is a profit margin, it is Rs 180 per year
- Advertisement revenue sharing with google and other advertisement channels, consider Rs Rs 500 per year
In 3 years
Rs 450 interest
Rs 540 internet profit
Rs 1500 ads revenue
Min 2490 Rs in 3 years profit …
Multiply Rs 2490 with at least 10 Cr subscribers
Rs 24900 Cr of profit in 3 years.
If you are asked to buy feature phone of Rs 2490 value today, you won’t buy it but for #Free tag everyone will buy.
We love free and RIL knows it very well.
But RIL has capabilities to bring capital on table through investors and shareholders.
As a business, they have no competition for their capabilities to deploy capital at such a large scale.
(Declaration : The views are authors personal and figures are based on his assumptions )