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Airtel in talks with domestic handset manufacturers to take on JioPhone: report

Bharti Airtel is in talks with handset manufacturer Lava and Karbonn to launch a new 4G smartphone at a price range of Rs 2,500 by October, to take on JioPhone, reports Economic Times. Airtel’s 4G feature phone might come bundled with unlimited data and voice minutes, similar to JioPhone packs which were unveiled at the time of launch.

The device will be marketed and sold by Airtel in collaboration with a handset manufacturer, and will run Android OS, unlike JioPhone which uses a Linux based mobile operating system called KaiOS. Airtel’s feature phone will support all apps from Google Play Store without any restrictions, unnamed sources told ET. On the other hand, it’s still not clear whether JioPhone will run apps from the open Internet. In a statement to MediaNama, an Airtel spokesperson refused to comment on the story saying “as a policy, we don’t comment on market speculation.”

With the launch of JioPhone, the Mukesh Ambani led telco is trying to be a telecom service provider as well as a manufacturer of devices via two brands— LYF and JioPhone. The JioPhone costs around Rs1,500 and this amount will be refunded to this user after 3 years and the device must be returned to the company in order to redeem the deposit. Effectively Jio is subsidizing its device and taking up the cost of manufacturing and promotions.

However, Airtel will not be subsidizing its devices, according to the ET report; it will instead sell it at an MRP price. The company’s MD and CEO Gopal Vittal also resounded this during a recent analyst call:

“We do not brand handsets on our own. We do not subsidize. We do not manage the inventories. We (will) work with different device players to bundle.” As per Vital’s response, Airtel will purely perform as a telecom service provider and will not look at manufacturing devices but instead, bundle with manufacturers to take on Jio.

In the quarter ended June 2017, Airtel had 62.6 million Internet users (3G+4G), up from 57.4 million users in the previous quarter. While Jio had around 123.3 million 4G users, but only 75% of them were active users, according to TRAI data.

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