Mumbai: Storming his way into telecom sector, Mukesh Ambani, India's richest man, Thursday announced the launch of much-talked about Jio 4G service, offering free voice calls and national roaming along with what he touted as the world's lowest data tariff.
Ambani, 59, who had more than a decade back left the telecom business to younger brother Anil when the Reliance empire their father had created was split, outlined his re-entry plans through a slew of "affordable" offerings and plans that promise to shake up the country's telecom industry.
Targeting 100 million customers in the shortest span of time, he told Reliance Industries' annual general meeting that its wireless phone unit, Reliance Jio Infocomm Ltd will offer data for Rs 50 per GB and monthly plan for as low as Rs 149.
Voice calling for Jio users will be free for life, so will be national roaming.
"We Indians have come to appreciate and applaud Gandhi-giri, now we can all do 'data-giri', which is an opportunity to do unlimited good things with unlimited data," Ambani said at the AGM.
In 2003, the undivided Reliance had created a storm of kind by announcing monsoon hungama, offering wireless connectivity for an unheard price of Rs 501.
Devoting two-third of his 90-minute speech to make a slew of announcements on Jio, he took competition head-on by announcing free services on Jio for four months beginning September 5.
Voice calling will be free on Jio phones for life and post December 31, 10 data plans will be offered starting at Rs 19 a day for occasional users, Rs 149 a month for low data users and Rs 4,999 a month for heavy data users.
In the speech that found mention of his children, Isha and Akash, who are both the directors on Jio as also his wife, Nita, Ambani did not forget to make a mention of government's ambitious programmes Digital India, Make in India and Prime Minister Narendra Modi.
"Jio will fulfill Digital India dream of Prime Minister Narendra Modi," he said, calling Jio a "revolutionary" step to realise India's digital ambitions.
Ambani didn't mince words when talking about the competition, asking them "not to misuse their market power by creating unfair hurdles, when it comes to providing points of interconnect between their networks and Jio's networks".
Telecom operators not only have legal obligation to provide points of interconnect to other operators, but also cannot limit customers' right to migrate to Jio using Mobile Number Portability, he said.
A company statement later said: "Jio may extend the period of free services in case Jio subscribers are not able to get adequate experience of seamless connectivity across network due to POI congestion and MNP restrictions and the quality of service parameters are not as per the benchmarks desired by management."
Ambani said Jio's base rate will be one-tenth of the prevailing data rates. "In our data plans, the effective rates will be 5 paisa per MB or Rs 50 per GB... The more data you use, the lower will be the rate," he said.
Stating that new handsets will be provided at affordable rates, he said LyF handsets will be available at price points starting from Rs 2,999. Devices for 2G/3G customers will be available at Rs 1,999.
Shares of Idea Cellular and Bharti Airtel tanked up to 9 percent today after Ambani announced the free voice calling and cheaper data tariffs.
Ambani said Jio will provide India's first mobile network running entirely on high-speed known as 4G and LTE, or fourth generation and long-term evolution.
The network will reach 18,000 cities and 200,000 villages with data speeds that will allow video calls and more, he said.
"Customers should pay for only one service, either voice or data. Not both... The era of paying for voice calls is ending," he said. "No Jio customer will ever have to pay for voice calls again."
He also announced a 25 percent more data for students, 1 million Wi-Fi hotspots across the country, "best-ever international calling rates", unlimited subscription to Jio app and special solutions for enterprises.
"Jio's data, voice, video and full bouquet of Jio applications and content will be available for everyone, absolutely free, till December 31, 2016," he said promising to offer data speeds of up to 1 gigabyte per second.
Reliance Jio Infocomm is offering unlimited data and premium access to all the Jio apps till the end of the year for all the consumers.
Ambani mentioned that it will have digital e-KYC activation so the SIM card can be activated instantly.
Reliance Jio claims to be the cheapest LTE provider in the world. "I believe that these are the absolute lowest data rates anywhere in the world. Jio makes India the highest quality, most affordable data market in the world," he said.
He also announced Jio's entrepreneurship fund that aims to provide venture capital to encourage young entrepreneurs to build digital businesses.
Archrival and the largest mobile operator in the country Bharti Airtel welcomed Reliance Jio's "entry to the digital world" and said as a responsible operator it will fulfil all regulatory obligations as always.
Vodafone Spokesperson said: "We have always offered great value to our customers, backed by excellent customer service, a nationwide presence, and Vodafone SuperNetTM - our best network ever. We will continue to do so for our hundreds of million customers across the country."
Existing operators under the aegis of Cellular Operators Association of India have been locked in a battle with Reliance Jio over providing points of interconnect.
Telecom analysts said Reliance Jio has delivered a knockout punch on pricing of voice and data tariffs.
"No doubt tariff plans for voice and data is going to be game changer for telecom industry... Though, topline from telecom business will start trickling in; however big concern arises on timelines of achieving operating break-even point in context of tariff policy deployed," said Dharmesh Kant, Head - Retail Research, Motilal Oswal Securities.