Telecom operator Reliance Communications has announced a strategic alliance with laptop companies Acer, Asus, HCL, Intel and Lenovo, to offer a laptop free with a two year “unlimited” subscription to its Internet data card service Reliance Netconnect. The specifications of the laptops aren’t mentioned, but with a lock-in of 2 years, the customers will pay a total of Rs. 36,000 and service tax over and above that.
Perhaps the laptop manufacturers are offering the laptops to RCom with reduced margins, hoping for an improved topline growth. In case of RCom, this may be a means of acquiring a subscriber base for wireless Internet services – one that they can later upgrade to higher speeds when 3G and/or WiMax services are eventually launched. Remember that BSNL has something of a head start here, with EVDO services already operational. I’m a Reliance NetConnect subscriber, and I can tell you that at an inconsistent speed of 2-14 kBps, it’s anything but Hi-speed; While typing this post, the NetConnect connection got disconnected thrice (thankfully, WordPress has an auto-save function) and I lost one version when I clicked “Publish”. I shudder to think about what will happen if they get more customers, and bandwidth get even more clogged. This also reminds me of something Shyam Somanadh of Web18 had said to me a year go – that it will take someone like a Reliance to go out and completely break this market open by offering PCs for free. In this case, it’s laptops, and probably lower margin than in case of PCs.
Also, does this mean that Reliance is no longer associated with the One Laptop Per Child project? Last year, RCom had announced a pilot with OLPC in Maharashtra, in a tribal village at Khairat (near Karjat, Maharashtra). The project had planned to cover “more than 25,000 towns and 60,000 villages” by March 2008. So obviously things didn’t go according to plan. Take this current announcement from RCom as, well, just an announcement, and hope for an increase in Internet penetration.