Airtel-Karbonn 4G smartphone to take on Reliance Jio Phone

New Delhi: India’s largest telecom company Bharti Airtel Ltd has tied up with Karbonn Mobile India Pvt. Ltd to introduce an affordable 4G smartphone, taking on Reliance Jio Infocomm Ltd’s 4G-enabled feature phone.

The smartphone will be bundled with a monthly recharge pack and come with cashback benefits.

The Android-based 4G smartphone will offer a full touch screen experience, dual SIM slots and access to popular apps like YouTube, WhatsApp, and Facebook.

Airtel said the price of the smartphone, Karbonn A40, which is being sold in the market for Rs3,499, would be slashed by 60% to Rs1,399 and will include a monthly pack of Rs169 from the telco.

Airtel will form such tie-ups with other device makers too, said Raj Pudipeddi, director–consumer business and chief marketing officer at Bharti Airtel, said. “We plan to partner with multiple manufacturers to bring affordable smartphone options to the market and build an ‘open ecosystem’ of low-cost devices,” Pudipeddi said.

Shares of Airtel rose 5% to Rs403.40 on a day the BSE’s benchmark Sensex fell 0.28% to 31,833.99 points.

The move comes almost three months after Reliance Jio, a unit of Mukesh Ambani’s Reliance Industries Ltd, introduced Jio Phone, its 4G-capable feature phone, which comes with unlimited data and optional TV streaming that is essentially free for subscribers who will merely pay a Rs1,500 security deposit refundable after three years. Reliance Jio has sold six million of its Jio Phone so far.

Since its launch last September, Jio has built a user base of 130 million, squeezing revenues and profits of incumbent telecom firms. In just six months since the launch, data consumption in India rose six-fold to 1.2 billion gigabytes per month, making India the largest mobile data consumer in the world, Ambani has claimed.

For the Karbonn phone, a buyer needs to make a down payment of Rs2,899 for the 4G smartphone and make 36 continuous monthly recharges of Rs169. The customer will get a cash refund of Rs500 after 18 months and another Rs1,000 after 36 months, taking the total cash benefit to Rs1,500, Airtel said in a statement.

In case the customer does not wish to opt for the Rs169 bundled plan, she has the flexibility to opt for recharges of any denomination and validity. To claim the cash refund benefit, recharges worth Rs3,000 must be done within the first 18 months (for the first refund of Rs500) and another Rs3,000 over the next 18 months (for the second refund of Rs1,000), the company said.