Reliance 4G tablet and the need for data plan pricing disruption

The news of Reliance launching its 4G services and a tablet to go with it is nothing new. It started with a Rs.8000 price tag, then it went further down to a Rs. 5000 price tag. The latest price tag we have is Rs. 3500. That is dangerously close to the Datawind Ubislate’s price (aka Aakash).

Reliance Industries will be using Long Term Evolution (LTE) technology from Qualcomm to roll its 4G services.

While these all could be rumors and speculations, you can’t deny the fact that Reliance has the spectrum for 4G services and it has to be launched at some point. There is no particular interest for anyone else to launch 4G products. It has to be Reliance Industries (RIL).

With the existing 3G plans, it is common wisdom that the device cost isn’t prohibitive, but it’s the rate plans. The existing 3G operators are charging Rs. 100 for a Gigabyte of download and they often don’t provide a trigger when you exceed a limit.

Reliance Industries wants to change that.

As per this ET story, RIL plans to launch 4G services for as low as Rs. 10 for 1 GB of download. A much needed disruption from a customer perspective. Is it lucrative enough to stay in business for RIL? Or would it end up like our existing voice services?

I hope not.

If you think about it, the device cost doesn’t matter much. Even if you buy a tablet which costs Rs. 13000 like a Reliance 3G Tab, you might end up paying more for the 3G services. Device cost doesn’t matter. Data plan rates do and it ought to be disrupted.