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Vodafone shrugs off Jio challenge, calls 'free voice' a gimmick

21 September 2016

Vodafone India, announcing its own new tariff plan called 'Flex', today shrugged off Reliance Jio Infocomm's entry into the market with ultra-low tariffs, saying offering low tariffs alone was not enough to grab a market share.

''We strongly believe that tariffs alone are not a long-term differentiator,'' Sandeep Kataria, director (commercial) at Vodafone India, said at a conference in New Delhi when asked about the 'disruptive' effect of Jio's entry. He said customer services and quality services were also essential for customer retention, and these were Vodafone's area of focus.

On Jio's offer of free voice calls, he said, "You do need to look beyond just a statement, to see is it really prudent to call it zero (voice tariffs) because it comes with caveats and conditions."

Vodafone announced a new prepaid plan that offers a single recharge pack for voice call, data, SMS and roaming requirements.

The company said that the plan, Vodafone Flex, would do away with the current practice of pre-paid consumers going in for multiple packs and recharges for optimising their monthly usage, and instead require the user to recharge one amount to flexibly use a combination of voice, data, SMS and roaming.

Essentially, a user can recharge a specified amount and get certain numbers of 'Flex' units in return.

In Delhi, for instance, a Rs118 recharge under the offering will give subscribers 325 Flex units. These units can then be used up for internet, SMS, roaming, and STD calls, based on the consumers own usage needs.

For a 1 MB 4G/3G/2G data usage or 1 SMS, or one minute incoming call on roaming, the consumer will end up using one 'Flex' unit; while 1 minute local or STD call, or one minute outgoing call on roaming will exhaust 2 such units, from his FLEX basket.

The unused units can be carried forward to the next month. The recharge values range from Rs 118 to Rs395.

"Today a prepaid user buys talktime, maybe a bonus pack for STD requirements, and a separate data pack ... we are combining all those in a single pack, with a validity of 28 days and no pre-fixed quotas for voice data or sms. It does away with the need to remember multiple validities, as it is a single pack," Kataria said.

The company is targeting 2G, 3G and 4G phone users with the new plan and not just 4G users.

On how the Flex pack monthly spends compare with the existing tariffs being offered in existing prepaid packs, Kataria claimed that consumers could save up to 25 per cent based on the individual usage patterns.

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