New £10 phone with e-wallet and streaming can bridge India ‘digital divide’, experts say

A new, minimalistic £10 phone with features like digital payments and streaming unveiled by Indian billionaire Mukesh Ambani’s Reliance Jio could help expand internet services to a wider audience in the country.

The affordable feature phone, priced at Rs 999 (about £10), can help bridge India’s “digital divide” by introducing 4G internet for the first time to scores of users, experts said.

“Reliance Jio’s persistence to bridge the ‘digital divide’ by putting 4G internet-capable phones in hands of 2G feature phone users or first-time users continues!” industry analyst Neil Shah from the research firm Counterpoint said.

Jio said in a press release earlier this week that the beta trial for its first million Jio Bharat phones would begin this week on Friday.

The low-cost 4G-enabled phone with a 2-inch display comes with a number of pre-installed features. These include mobile payments through the United Payments Interface (UPI) – a form of instant digital payments that are widely used in India – as well as access to Jio’s own on-demand video and music streaming services JioCinema and JioSaavn.

The low cost of the new phone may also bring the internet further within the reach of women in households.

In low-income households in India, mobile phones remain a shared device with internet access shared on an individual mobile phone, explained digital rights activist Nikhil Pahwa, founder of tech policy analysis website MediaNama.

“Typically, there is one person in the household whose mobile phone has internet access because devices are expensive and internet access prices have increased of late,” Mr Pahwa told The Independent.

“So, a low-cost device means it will become affordable for low-income households to have more than one handset. This is great for women because typically it is the men in the house that have access to the internet,” he said.

Reliance Jio said the phone will also come with a Rs 123 (£1.2) data plan valid for 28 days, offering 14GB of internet access (0.5 GB or 500 MB per day) – a price the company claims is 30 per cent cheaper than plans offered by competitors.

This move may lead to other network operators in India such as Bharti Airtel reducing their tariffs too.

“Bharti recently raised 2G prices from Rs99 to Rs155 across all circles while Vi [Vodafone Idea] took this in one circle. This disruptive step can halt incremental tariff increases for 2G and help JIO gain share in that segment,” JP Morgan said in a report on Tuesday.

Following Jio’s announcement, shares for Bharti Airtel and Vi slipped by 2 to 3 per cent in early trading on Tuesday.

The move also brings internet-enabled phones within the reach of the masses, and as more people understand the utility of the internet, it may lead to the further conversion of featurephone users to adopt smartphones, industry experts said.

“There are still 250 million mobile phone users in India who remain ‘trapped’ in the 2G era, unable to tap into basic features of the internet at a time when the world stands at the cusp of a 5G revolution,” Reliance Jio Chairman Akash Ambani said.

Telecom analyst Tarun Pathak tweeted that the featurephone-to-smartphone conversion in India has slowed down due to some “upgrade barriers”, adding that “Jio Bharat aims to bridge that gap”.