Airtel announces partnership with SpaceX to bring Starlink’s high-speed satellite Internet to India. This is called a REAL trump card. I have always been a big admirer of Sunil Mittal (Chairperson of Bharti Enterprises) and what he pulled off today was a checkmate move to Jio.
But they have to decrease the cost of Starlink services, or they can't survive! Will lower Starlink costs really challenge Jio’s dominance?
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All concerns are now focused on pricing, as Starlink is very expensive, and I hope that it will not disrupt current prices. All eyes are on Jio now, wondering what their move will be and whether they will offer prices cheaper than Airtel x Starlink. But also, my eyes on VI.
In India, in most villages, so many people use only basic mobiles. They don’t need data, they only need a validity period. But both Airtel and Jio raised their tariffs and don’t have separate plans for non-data users. So non-data users are also forced to pay huge sums of money for recharge.
Airtel to Offer Starlink Satellite Internet Service in India
They know Elon Musk would probably win the auction, but they still want an auction. I see two reasons for this :
1) I think current players will bid high and make Musk pay a lot to the government to get the contract if Elon Musk wants it, if bad, because they know it'll be allocated to Starlink. Doing this, the government will get a lot of money and Elon will have to pay a huge price, forcing him to launch the products at a high rate which won't be accessible by the majority of the population, so Starlink will fail.
2) If it's allocated directly to Starlink, then it'll be cheap and people would switch to that. Jio, Airtel and VI will lose business.
Auctions will most definitely result in increased prices. Even if the local companies win, they'll have to pay a lot and the price will be high. So people will stay with the current system and they'll still be profitable.
These companies don't want anything for people, they just want to stay in business.
Why do people assume that Starlink is going to reduce Jio and Airtel cellular tariffs? Starlink is an Internet Service Provider (ISP) just like Act Fiber and You Broadband and not a telecom provider like Jio, Airtel, BSNL and VI. So thinking that it will force Jio and Airtel to reduce tariffs is foolish.
And FYI, Starlink is like a niche product. It's expensive compared to optic fiber networks. So no competition in prices. In India, broadband internet is the cheapest compared to other nations. Also, its usage is different. It holds a specific customer base and not a wide customer base.
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