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Reliance Communications & Google In Exclusive Tie-Up For Android Handsets In India


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#1 Arun

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Posted 13 April 2012 - 09:23 PM

Times of India
April 13, 2012, 10.09 AM IST

Every Google-endorsed Android smartphone that is sold in the country will now come bundled with a Reliance Communications mobile connection as the Anil Ambani company targets high-end users to ramp up subscribers.

RCom and Google have entered into a two-year deal according to which all Google-endorsed android mobile devices from companies like Samsung, HTC, Sony Ericsson and LG will come with the telco's third generation, or 3G, mobile connection with 1 GB of free downloads for the first six months.

But these devices will work on networks of all other mobile operators and consumers will have the option to switch to other operators.

Industry experts estimate that more than 200,000 such phones will be sold in India over the next two years and that RCom will be able to retain two-thirds of these customers on a long-term basis.

"RCom would be able to retain more than a fair share of these customers on its network," said Prashant Singhal, Partner at Ernst & Young Global's Indian affiliate. "The intangible brand benefits from such an exclusive tie-up will exceed the monetary benefits in the two years."

Singhal said the number of subscribers that the company will add because of the tie-up will not make a substantial difference to its overall user base or to its revenues. But it will help RCom in positioning itself as a network for premium users, enhancing its current image.

As part of the agreement, RCom, the country's second-largest telco by subscribers, will launch a 30-crore campaign for Google Android products starting Saturday.

Google has also committed to an equivalently valued campaign on its online platforms. The advertisement, that depicts the android logo Green Bot going blue, will include platforms like augmented reality and will continue till the T20 World Cup.

"We are creating a dedicated help desk to which any android phone bought under this agreement will be mapped automatically," said Sanjay Behl, group head, brand and marketing, Reliance Communications.

The two companies are assigning two dedicated marketing people each for the initiative, he added.

"We confirm the collaboration with Reliance to market Android devices," said a Google spokeswoman.

This will be Google's fourth such deal globally. It has similar agreements with Verizon in the US, Telstra in Australia and one in Japan.

The Android platform was created by Google, but has since been made open, or publicly available. Manufacturers using Google's android version carry a Google logo and the Green Bot on them.

These are Google-endorsed. Others who are using the publicly available version of android like the ZTE and Huawei phones do not have the Google logo. In India, Idea Cellular offer packs with Android-based handsets from ZTE and Huawei.

In the past, Aircel and Bharti Airtel had exclusively launched Apple's iPhone in India as part of similar tie-ups. Airtel retained a sizeable number of the customers that bought the phone, while many who bought it from Aircel switched to other networks.

Average monthly bills of customers using data-oriented phones like Google Android devices is estimated to be around 250-300, while the average monthly bill of a Reliance Communications customer is around 100.
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#2 shashank

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Posted 13 April 2012 - 09:41 PM

What about the circles in which Reliance doesn't have 3G spectrum?

#3 krishnendu halder

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Posted 13 April 2012 - 11:32 PM

people will leave reliance due to voice quality in gsm!its terrible :doh:

#4 Venkatagiri

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Posted 14 April 2012 - 07:41 AM

Win Win situation for RCom and Google.
While RCom's strength will take Android to the mass Google will help RCom to add more subscribers.

Android will sure be the leader amongst mobile OS
People in a country are as good as their leaders.

#5 city02

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Posted 16 April 2012 - 09:48 AM

Win Win situation for RCom and Google. be the


i doubt it very much
good for google - but a money loser for rcom
rcom will spend rs. 30 cr of its own money for ads / media spends

while google will only put the same amount in online ads which is a notional cost
if google had spent the same amt of its actual money on other sites not owned by it
then it would be comparable investments

google will have book keeping entries only with no real cash changing hands unlike rcom
the projection of 2 lakh handsets is too optimistic - i expect barely 1.5 lakh
also its very unlikely to retain 2/3rd of customers as rcom subs - i guess it'll be below half
that's a total of hardly 75 k vs projection of 133 k

lets assume that rcom gets the max of rs. 300 arpu which is impossible from ALL its retained subs
at an acquisition cost of rs. 30 cr = almost 3 k / subs
that's 10-11 months to 'recover' the ad cost alone
do keep in mind this is not breakeven yet
with margins of hardly 9-10% that's rs. 30 net monthly or 8 years to cash flow breakeven!

nice job rcom!
they would have been better off simply pre-paying debt by 30 cr and reducing interest charges by almost rs. 3 Cr / year from day 1 instead of waiting 8 years to breakeven ...

keep in mind this is assuming ZERO churn which impossible and
no interest of all its outstanding debt which avg is about 10-11% annually
else it will push out the breakeven further out to beyond 16 yrs!
who keeps the same handset beyond 5-6 yrs?

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#6 rajanmehta

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Posted 16 April 2012 - 01:41 PM

Times of India
April 13, 2012, 10.09 AM IST

with 1 GB of free downloads for the first six months.


Offer Page is now live on RCOMM Website >> http://www.rcom.co.i...idReliance.html

It is 1GB 3G Data FREE for only ONE Month.

#7 Babhishek

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Posted 16 April 2012 - 02:27 PM

so much for an offer!

#8 pasumark

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Posted 17 April 2012 - 09:59 AM

The association with Google will improve the image of Reliance Mobile, which is very down now. So when brand value is improved, it is expected to bring more customers.

Lets wait and see in long run, if this strategy works
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#9 city02

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Posted 17 April 2012 - 10:44 AM

i disagree
brand associations are very fickle

if it were that easy to manage customer perceptions,
any telco could have associated with a luxury brand and improved its image:
imagine airtel offering a free iphone4 with every merc sold or
vodafone offering a free android handset and sim with every bmw

the reality simply does not work that way
there is no easy way out
no quick fix to your reputation
it actually takes years of hard work and improving customer service as opposed to an ad campaign
no matter how long or expensive

i agree we should wait and see but the writing is already on the wall for such tie ups

The association with Google will improve the image of Reliance Mobile, which is very down now. So when brand value is improved, it is expected to bring more customers.

Lets wait and see in long run, if this strategy works


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#10 HetalDP

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Posted 17 April 2012 - 10:54 AM

Useless Effort by Reliance, their 70% customers are Prepaid CDMA and they dont have any Damn Good Data plan for them, why this patch work then ?
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#11 garry1313

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Posted 17 April 2012 - 04:05 PM

^^^
Hetal sir...only 20% of the total base of reliance is cdma. Yes you can always say the contactability of cdma is higher ;)

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#12 rajanmehta

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Posted 17 April 2012 - 05:50 PM

^^^
CDMA only 20% of total RCOMM Subscriber base? Looks unbelievable! :confuse:
In any case Reliance is not publishing since long time breakup of CDMA and GSM subscriber base.
What's the source of that %?

#13 me_saket

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Posted 17 April 2012 - 08:07 PM

i also dont believe in 20 % figure

if i check phone book from my other person's mobile phone

thwn i found 90% reliance cdma customer and just 10% rgsm,

even in state where rcom(previously reliance telecom RTL), then have ratio of 50-50% cdma to gsm base, when search phonebook.
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#14 garry1313

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Posted 17 April 2012 - 08:12 PM

^^^
Rajan sir,Source of the figure is the subscriber base reported to TERM

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#15 KanagaDeepan

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Posted 17 April 2012 - 09:47 PM

Only 20% is the CDMA part of RCom is unbelievable or even impossible, due to the cr@ppy network of RGsm and RTL (in CG afaik)....

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