Om and others have articles lauding Indian mobile operator Reliance's launch of "free" netbooks PCs, subsidised through 24-month data contracts at $30 a month. There is the suggestion that this model could radically change the uptake of PCs in emerging markets.
My view is that this model may indeed be quite popular among certain segments of the urban India population - especially some in the new "middle class" of professionals. BUT it's important to avoid being seduced by numbers like India's overall billion-strong population, or 287 million overall mobile subscribers. But these are not representative of the realistic addressable market for this type of service.
Let's have a closer look at the figures. $30 is approximately 1500 rupees
Reliance has got 51m customers, which is indeed a big number. But 91% of these are on prepaid subscriptions. And 99% of its last quarter's net adds were prepaid, so the balance is shifting to the worse. Its blended ARPU is 282 rupees, although obviously that's skewed by the volume of low-end prepay accounts. However, this very good post cites India's overall (all operators) postpaid ARPU at 600 rupees on GSM and 636 Rs on CDMA [on which the Reliance netbook has been launched]
So despite big headline numbers for India, there are only around 25m current postpaid monthly mobile subscriptions.
In April, Reliance was reported to be selling around 12-14,000 dongle accounts per month, so I'd guess it probably has around 250-300k total data card users, with maybe 500k across India as a whole as Reliance itself estimates it has a c60% share.
And this $30 a month netbook is about 2.5 times the average voice ARPU level. And it's on a 2.5G network (CDMA 1x-RTT), not 3G.
By comparison, Vodafone UK's £25 a month Dell netbook offer compares with a £41 postpaid ARPU, with a 7.2Mbit/s HSPA connection.
As another benchmark, Reliance's landline broadband business has 1.1m subscribers at an average 1715 rupees per month. Overall, there are only around 4.4m broadband lines in the whole country - including business users and shared locations like Internet cafes. So against this, the Reliance mobile proposition sounds an OK deal for young professionals living on their own - but less suitable for instances where a whole family shares a PC.
Bottom line - Reliance's 2G-bundled "free" netbook is an interesting proposition for a small slice of the Indian population. But in my view it's still far too expensive to underlie a major shift in PC adoption in countries like India.
On a side note - that blog post has some interesting commentary on wireless Internet users in India, suggesting that some of the official statistics have questionable definitions. Against a "headline" figure of 75m Internet-enabled subscribers, it cites local experts as estinating the real number of actual active users (mostly using WAP rather than full mobile Web) at 10-15m.
Speaking Engagements & Private Workshops - Get Dean Bubley to present or chair your event
Need an experienced, provocative & influential telecoms keynote speaker, moderator/chair or workshop facilitator?
To discuss Dean Bubley's appearance at a specific event, contact information AT disruptive-analysis DOT com