NEW DELHI/MUMBAI: Reliance Industries (RIL) is likely to launch an affordable, 5G-ready Android smartphone in the next fiscal’s second quarter, as the conglomerate continues to woo the over-300 million feature phone users in India to switch to its telecom arm, Reliance Jio.
People familiar with the matter said RIL is working on a May-June timeline to complete the R&D of the device, which is being developed in partnership with tech giant Google.
“But a launch will most likely be in the second quarter of FY21. It may coincide with the annual general meeting (AGM), usually held in August-September, when RIL has typically made all its previous announcements regarding its feature phones and fibre, among others” one of the persons cited earlier said.
At the AGM, RIL may also announce its plan regarding a laptop, called JioBook, which is aimed at penetrating the education sector.
In April 2018, ET had reported Jio‘s plans to build a Qualcomm chipset-powered laptop.
Reliance Jio’s pace of adding new users has slowed rapidly from the middle of 2020. During the period, rival Bharti Airtel added more users than Jio. In this backdrop, Jio’s proposed smartphone would add steam to the company’s efforts to woo phone users.
In the October-December quarter, Jio added over 5 million users compared to Airtel’s over 14 million. Analysts said Airtel has been more successful in attracting Vodafone Idea’s users, including 2G ones, compared with Jio.
To pick up user addition momentum, Jio recently announced new tariff plans aimed at retaining the 100 million users of its 4G feature phone, JioPhone, as well as attract new 2G users from rivals.
“While this move (new plans) should help gain market share among 2G users, we maintain that low-cost smartphones will still be required to retain JioPhone users coming out of 3-year contracts,” Jeferries said in a note.
The new smartphone from RIL is part of a two-pronged alliance with Google—in the first, Google picked up 7.73% stake in Jio Platforms, the parent of Reliance Jio, last June for Rs 33,737 crore. The second one was a commercial agreement with Google to jointly develop an entry-level, 4G smartphone which can also support 5G in future.
“The development of the phone is on track. The specifications have been finalised. However, there are ongoing discussions on the operating system, given that it will require deep integration of Jio services,” said another executive aware of the development.
According to the executive, the company is developing JioOS, a forked or custom version of Google’s Android operating system, for optimised performance of Jio applications. “However, both companies are still discussing which version of Android is to be used for the smartphone. The phone could also feature an Android Go operating system with entry-level specifications,” the executive said.
A hurdle to meeting the timelines, though, could be the ongoing shortage of components such as display, memory and chipsets, which has also impacted other Indian brands.
ET has learnt that Jio is negotiating with its electronic manufacturing service partners for local production of the Jio-Google smartphone.
Currently, US contract manufacturers Flex makes the RIL’s 4G feature phone, JioPhone.
For Mukesh Ambani-led Jio, the new phone will ensure that its own some 100 million JioPhone subscribers transition easily from the 4G feature phone to a smartphone. Also, it will try and attract the 300 million feature phone users currently on the networks of Bharti Airtel, Vodafone Idea and state-run Bharat Sanchar Nigam Ltd.
Amid the slowing pace of user additions, Jio recently dropped its usage costs of its feature phone by 25% with two offers, forcing rivals to delay their tariff hike plans.
According to JM Financial, the largest telco’s new tariff offer for its 100 million Jio Phone users is aimed at retaining them and getting more additions from the 300 million feature phone users.
“This is expected to be followed by the launch of the low-cost smartphone in association with Google,” it said.