On 1 September 2016, Reliance Jio launched as the latest entrant in India’s mature, super-competitive telecom industry. And yet in a mere five months, it was able to cross 100 million subscribers in spite of close to 90% mobile penetration, globally competitive tariffs for both voice and data, efficiently run operations and over a dozen firms.

How? Because Jio’s servicesunlimited voice calls and datawere available free of cost. What might have been an open and shut case of predatory pricing in other countries was overlooked by the telecom regulator, TRAI, which bought Reliance’s explanation that Jio’s services were only ‘promotional’ in nature.

Now imagine for a second, Uber offering cab rides free of cost for six months. Or Samsung offering its phones free of cost. You’ll find this hard to imagine because that’s how absurd it is. Ironically, this is a time in our country where a lot of things are going for free; not just restricted to the private sector.

On 1 January 2017, Prime Minister Narendra Modi launched ‘BHIM’, a mobile app that allowed people to transfer money to each other or make payments for services. In less than two months, BHIM has had over 17 million downloads and proven to be a serious competitor to several other competing apps.

How? Because BHIM was free too.

On 4 March 2017, the TRAI chairman RS Sharma published a signed, 1200-word column in the Indian Express, saying “the cost of digital transactions should be almost zero, if not negative, compared to cash.” He also rubbished the practice of service providers charging a ‘convenience fee’ for digital transactions, after acknowledging that it formed a revenue stream for many websites. Instead of a fee, the sites ought to provide a discount on online transactions, said Sharma.

A question can be asked: Whose convenience is it? Buying a cinema or airline ticket online means that the customer is paying the data charges to make the transactions and printing her own ticket. On the other hand, if she purchased the ticket from the counter, it would mean the time of the counter-clerk, printing cost of ticket et al. A digital transaction reduces the cost of service providers and they should provide a discount on online transactions

RS Sharma

‘Free’ is the hammer. And suddenly every profitable business is potentially a nail.

Fee is now free

How do you disrupt functioning, competitive markets with multiple strong companies? By taking away their pricing power.

Multiple sources within the banking and fintech sectors say that they are all bracing for a major and imminent disruption: the merchant fee (MDR) on payments under Rs 2000 being made entirely free. One major firm is said to be lobbying for it. The Ken was unable to conclusively verify either of these.

AUTHOR

Rohin Dharmakumar

Rohin is co-founder and CEO at The Ken. He holds an MBA from the Indian Institute of Management, Calcutta and an engineering degree in Computer Sciences from the R.V.C.E., Bangalore.

View Full Profile

Subscribe to read this story

The Ken is the only business subscription you need. Questions?

 

Premium

  • 5 original and reported longform business stories every week
  • Access to ONLY India edition
  • Close to 250 exclusive stories every year
  • Full access to over 5 years of paywalled stories
  • Pick up to 5 premium subscriber newsletters
  • 4 original and reported longform business stories each week
  • Access to ONLY Southeast Asia edition
  • Close to 200 exclusive stories every year
  • Full access to all paywalled stories since March 2020
  • Pick up to 5 premium subscriber newsletters

Rs. 2,750 /year

$ 120 /year

India Edition
Subscribe Subscribe
Most Asked For

Borderless

  • 8 original and reported longform business stories each week
  • Access to both India and Southeast Asia editions
  • Close to 400 exclusive stories every year
  • Full access to over 5 years of paywalled stories across India and Southeast Asia
  • Unlimited access to all premium subscriber newsletters
  • Visual Stories

Rs. 4,200 /year

Subscribe
 

Echelon

  • 8 original and reported longform business stories each week
  • Access to both India and Southeast Asia editions
  • Close to 400 exclusive stories every year
  • Full access to over 5 years of paywalled stories across India and Southeast Asia
  • Unlimited access to all premium subscriber newsletters
  • Visual Stories
  • Bonus annual gift subscription
  • Priority access to all new products and features

Rs. 8,474 /year

Subscribe
Or

Questions?

What kind of subscription plans do you offer?

We have three types of subscriptions
- Premium which gives you access to either the India or the Southeast Asia edition.
- Borderless which gives you complete access to The Ken across both editions
- Echelon which gives you complete access to The Ken across both editions along with a bonus gift subscription

What do I get if I subscribe?

The Premium edition gives you access to stories in that edition along with any five subscriber-only newsletters of your choice.

The Borderless and Echelon subscription gives you complete access to The Ken across editions and unlimited access to as many newsletters as you like.

What topics do you usually write about?

We publish sharp, original and reported stories on technology, business and healthcare. Our stories are forward-looking, analytical and directional — supported by data, visualisations and infographics. We use language and narrative that is accessible to even lay readers. And we optimise for quality over quantity, every single time.

Our specialised subscriber-only newsletters are written by our expert, award-winning journalists and cover a range of topics across finance, retail, clean energy, cryptocurrency, ed-tech and many more.

How many newsletters do you have?

We are constantly adding specialised subscriber-only newsletters all the time. All of these are written by our team of award-winning journalists on a specialised topic.

You can see the list of newsletters that we publish over here.

Does a Premium subscription to your Indian edition get me access to the Southeast Asia edition? Or vice-versa?

Afraid not. Each edition is separate with its own subscription plan. The India edition publishes stories focused on India. The Southeast Asia edition is focused on Southeast Asia. We may occasionally cross-publish stories from one edition to the other.

We recommend the Borderless or the Echelon Plan which will give you access to stories across both editions.

Do you have a mobile app?

Yes! We have a top-rated mobile app on both iOS and Android which allows you to read on-the-go and has some amazing features like the ability to bookmark stories, save on your device, dark mode, and much more. It’s really the best way to read The Ken.

Is there a free trial?

You can sign up for a free account to experience The Ken and understand our products better. We’ll send you some free stories and newsletters occasionally, and you can access our archive of previously published free stories. You can stay on the free account as long as you’d like.

The vast majority of our stories, articles and newsletters can be accessed only by a paid subscription.

Do you offer any discounts?

Sorry, no. Our journalism is funded completely by our subscribers. We believe that quality journalism comes at a price, and readers trust and pay us so that we can remain independent.

Do you offer refunds?

No. We allow you to sample our journalism for free before signing up, and after you do, we stand by its quality. But we do not offer refunds.

I am facing some trouble purchasing a subscription. What can I do?

Just write to us at [email protected] with details. We’ll help you out.

I have a few more questions. How can I reach out to you?

Sure. Just email us at [email protected] or follow us on Twitter.