How Xiaomi and Jio changed the Indian market forever

-          Vaishak Menon

The world has moved on from paying Rs. 350 for a gigabyte of data with a 28-day validity to paying the same amount for a gigabyte a day for a month’s validity. 

THE DOCUMENTED BOOM

The report, Mobile Internet in India 2017, published jointly by the Internet and Mobile Association of India (IAMAI) and KANTAR-IMRB, estimates 291 million urban mobile internet users and 187 million rural mobile internet users as of December 2017.

According to the report, the number of mobile internet users increased by 17.22 percent from December 2016 to reach 456 million users by December 2017. Urban India witnessed an estimated 18.64 percent year-on-year rise, while rural India witnessed an estimated growth of 15.03 percent during the same period. With 59 percent penetration, the report highlights that urban India is expected to show a slowdown, while rural India - with only 18 percent mobile internet penetration - is clearly the next area of growth.

JIO’s GIFT TO MANKIND

Jio was launched (to the general public) on the 5^th of septeember 2016, with it’s revolutionary Welcome plan, that was later extended to give users a total of 6 months of free mobile data usage as well as free calls. Anyone with a 4G phone and an Aadhar card could avail this offer, which they did and the number of people connected to the internet, especially on mobile devices, skyrocketed like never before.

This also had an interesting effect on the competition, who to retain customers, offered extremely low rates. Once the free period had passed on, Jio continued to offer their services at a lower rate, thus forcing competitors to do the same.

By doing this, they successfully entered and revolutionised an oligopoly, enabling the masses to access the 4G spectrum – which was once considered a luxury!

XIAOMI’s MOVE

The world has also moved on from paying north of Rs. 50 grand for a phone that didn’t lag.

Xiaomi didn’t give away its products for free but has successfully risen to be one of the leading phone manufacturers, not just in India, but throughout the world. By bringing quality features in a surprisingly affordable price range, Xiaomi captured the mid range phone market, competing with one of the oldest and strongest manufacturer -  Samsung. 

Apart from the affordable premiumish phones, they’ve also setup factories in India with over 75% of the goods being manufactured in India. Always on the top when it comes to innovation, Xiaomi has never failed to impress. A survey conducted by the Digit magazine in 2017 showed that 27% of Indians use a Xiaomi phone, with a prediction of even more number of phones being sold in the following year.

Although Xiaomi initially stuck to online sales, they’ve partnered with a shops all over the country to make phones available offline as well. 

By bringing quality to the masses, these companies have opened door to a ton of possibilities. There has been a surge in streaming content in India, with people using services such as Hotstar, Netflix, Wynk, Gaana etc. Even Spotify is all set to launch in India. Mobile payment services like Paytm, Tez and other UPI/Mobile wallets are more widely accepted, Cab and food delivery services, offer their services to more regions now. 

Although their intentions might not have been such, these companies have changed the way we live, by causing a ‘Domino effect’. Hopefully in the near future we’ll see a better penetration in the rural areas of India as well, with more Indians joining the internet world, gaining access to a hoard of information and connecting beyond borders. The government has been working for a while on apps meant for farmers and rural offices, as a part of their mission to connect the rural world to the urban.

Although we're late in this race, a future where everything runs on smartphones is not a distant one.