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Is the Reliance Apple iPhone 5S Offer Worth it?

RCOM has a great offer for the Apple iPhone 5 (C and S), where you pay very little down, pay every month instead for 24 months, and then get all voice, SMS and data for free, unlimited. But how good is the offer?

Also See: Unbundling the iPhone 5S Deal For a Cheap Unlimited 2 Year Plan

 

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First, if you’re one of those mad Apple fans that will only use Apple products no matter what the rational argument against them, just because they’re Apple, then you should stop reading here because you couldn’t care less what the economics is.

Now, let’s see the offer. From the press release:

image

This means you pay Rs. 2,600 per month for an iPhone 5C, and Rs. 3,000 per month for an iPhone 5S.

And then, from @Harry_Jerry:

EMI details for the Reliance iPhone 5s bundle -

 

The Deal

As a bundled deal, the transaction gives you a phone and two years of services free, as long as you pay a fixed amount every month. You get unlimited data, unlimited (India) calls, and unlimited SMS (limited to 3K texts per month).

What you do is:

  • swipe your credit card – only Citi, Stanchart and ICICI (and now, HDFC, it seems).
  • The amount charged is Rs. 61,856 (for the iPhone 5S, 16 GB).
  • You then pay your credit card back every month: a sum of Rs. 2,999 will be added to your outstanding amounts

Credit Card Limits, EMI and Interest

For the example above, You need an available limit of Rs. 62,000 or more to avail this facility – the entire amount gets swiped and converted to an EMI. This is like a retail transaction to EMI scheme that many banks have.

That also means Rs. 62,000 is blocked from the credit card limit immediately. If you have a Rs. 75,000 limit, you will only get to use Rs. 13,000 on further purchases.

Every month, your EMI will pay principal and interest. The principal paid will free up your limit every month:

image

You are paying 15% interest for this loan, which is competitive.

What isn’t apparent is “service tax”. You will need to pay 12.36% service tax on the interest component. This adds up to another Rs. 1,000 over the term of the loan. (See SBI Terms)

Minimum Amount Due and Reward Points

Every month your credit card comes with a “Total Amount Due”, a “Minimum Amount Due” (which means you roll over the rest). Assume things are the same for the card balance (beyond what’s blocked for the iPhone purchase), and your minimum amount due will be whatever it used to be earlier, plus the EMI amount.

If for any reason you can’t pay the “minimum amount due” you will then have penalty charges and interest (usually very hefty, more than 3% a month).

You might not get reward points on this transaction. ICICI bank’s terms say:

  • The card member has understood that by availing the facility, the card member shall not be, unless otherwise stated by ICICI Bank in writing, eligible for any reward points whatsoever, whether awarded under the ICICI Bank Reward Points Scheme or any other reward points scheme on the card that may be announced by ICICI Bank from time to time.

Can You Run Away With The Phone and Not Pay?

Of course you can. But that’s like saying “Can you steal my car?”

Your loan is from a bank (that issues the credit card), not from Reliance. So if you default, the bank will come after you for the loan. They will add you as a defaulter to CIBIL.

They don’t care about whether you have decided to become an Android fan, and they will not cancel the loan if you give back the phone. You have to pay the full amount, and they can get a hold of you even  10 years later. Your credit card will be blocked – because you’re not defaulting just on this, it’s a default on your card dues.

My advice: Just Don’t Do It.

If the person giving the loan was Reliance – and it used to be the one taking the risk in 2000 when it introduced phones for Rs. 500 apiece – the risk would be of Reliance and they have shown they aren’t very good at catching people who stiff them. But a bank is a different proposition.

Why is Reliance doing this?

Reliance gets Rs. 61,856 upfront. In that, it has to provide a phone which it probably gets at way cheaper than market. The retail price is Rs. 53,500 so we can guess it gets the phone for about Rs. 40,000.

Effectively, RCOM will get about Rs. 22,000 as a margin on this product, and this should cover what it costs to provide the free services for 24 months. This comes to about Rs. 1000 per month as a discounted return. Providing an “unlimited” service with a definite customer for 24 months isn’t a bad deal (even if you walk away, they still make that much money since its paid upfront).

Which also means: if their service sucks big time, you can’t do a darn thing, because you have already given them your money for 24 months.

Additionally, as a “source” of the loan, the bank might pay them about 2% , which is another Rs, 1,000 they earn.

Any other pitfalls?

Network woes: If you buy this phone and you’re not already a Reliance subscriber, you might have to change numbers (or port your number, which could be painful). The Reliance 3G network isn’t available everywhere (it’s not in Bangalore, for instance) so you might find that a pain.

Upgrades: There will be an iPhone 6, and then 7 or whatever. The bank doesn’t care. You don’t get the upgrade, unless you pay for it separately. This is what makes this deal very different from the operator deals.

The above chart shows you that you have about Rs. 33,000 left to pay after a year. That means a year later, if you want to upgrade to an iPhone 6, you will still have to pay Rs. 33,000 and then buy the other iPhone. You might be able to sell this phone and enter into a fresh contract for the new one, but that will require RCOM to unlock your phone (who’ll buy it if it’s locked to your number), which is a pain.

No LTE (yet): Want an even faster connection? RCOM’s offer comes with 3G, but what when they roll out the 4G LTE? You don’t get the faster speeds for free, most likely.

What are the alternatives?

You can buy this phone at a lower cost, in the market. The iPhone 5S (16 GB) sells for Rs. 53,500.

Perhaps you won’t get all the freebies, but think about your usage. I use a prepaid Airtel connection and I don’t pay more than Rs. 1,000 per month for voice plus incredible amounts of data. You also get the advantage of being able to use it on different networks and without changing your phone number.

However, even if this amount is converted to an EMI for 24 months at 12% per annum (the lowest that you will get), you still pay Rs. 2,500 a month for the EMI, plus now you have to pay for usage, which is likely to be higher than Rs. 500 per month. So it might not really be worth it.

You can use their “discounted option” of paying the full amount minus Rs. 6,000. For an iPhone 5S, you pay Rs. 66,000 upfront for the same deal. This makes little economic sense, as the EMI option is an effective 10% more, for two years, which is better (even if you have the money).

And then, of course, you could use an alternative phone itself. I have a 5 inch Android Micromax Canvas HD 2 bought for 14K in April with 32 GB extended memory, and I use it as a phone, a camera, an alarm clock, a trading terminal, a twitter client, facebook, email, tv-remote (!), and a music player. Sure, you might miss the fingerprint recognition or iTunes, but I couldn’t care less.

I know some of you think little of brands like Micromax; I don’t go by brand value. I’m always rooting for the underdog.

Where Do We Stand?

Compared to a Samsung Note 3 (Rs. 47,000) or a Nexus 4 (Rs. 25,000) this phone might seem expensive. But if you

  • really want to buy the iPhone 5(S or C), and
  • don’t mind switching to the Reliance network, and
  • don’t care about upgrading your phone for two more years, and
  • don’t want 4G LTE for free when it comes, and
  • don’t have a problem with the limit getting blocked on your card, and
  • can afford this EMI (A must. Revolving credit costs on credit cards are ludicrously high)

You should take this offer. If any of the above are a potential no, you have to figure out if it is a calculated risk or a potential waste of money.

(Or, if you’re a mad Apple fan, ignore everything above and just buy it)

Also See: Unbundling the iPhone 5S Deal For a Cheap Unlimited 2 Year Plan

  • Aejas Lakhani says:

    Fantastic article. Thank you

  • Ninad says:

    Good article on the iphone 5(C, S) Reliance offer.
    All in all iphones are always way too expensive and only die hard Apple fans will go for it else it really does not make sense paying 3K for 24 months. Add to that
    No sd card facility (if u go in for less than 32g phone)
    Heavy dependence on Itunes for all types of functions–transferring movies and songs

  • raghav says:

    Superb Analysis 🙂

  • ramjobs.in says:

    excellent article sir,
    It is an eye opener for all. i just do not get it why are some people just mad about iphone and pay that much amount you get a very good phone from 10000 to 20000 bugs like iball andi 5h quadro or xolo or intext i7 and so on

  • Him says:

    Good Analysis, but important to note is that its not free. People think its free. My usage is 600 at the moment. So the important criteria is whether i want unlimited just because they offer it. If 600 serves my purpose my total cost per year for calling would be 7200 rs and 14400 for two years. Then the cost of 5S would be 53000 so total cost would be 67000. I would still pay extra 7000. This is ofcourse if i want the iphone. They are make me pay additional 2400 for this deal. So the phone is not free for sure. And like you said if i buy a solid phone like lumia 820 that has more features than 5s. It costs me only 20,000. Total 34000 for 24 months. 1400 per month. So it what you say but its not free fone by any reason unless your monthly usage is more than 3000

  • hrpanjwani says:

    The article covers the issue quite nicely. Of course everyone has different needs and resources and should judge for themselves what is the best deal for them.
    As it stands the deal looks like it is a good one for me as my digital world is apple centric (Mac/iPad/iPhone) after having lived in the US for a few years and I have a well paying job that makes the EMI an easy expense to accommodate. Plus my iPhone 4 is getting long in the tooth so I am quite tempted to pull the trigger on this.
    The big question is what charges do I pay after 24 months, which this article does not cover. If the charges stay the same it’s a bad deal. If the charges drop down to normal that’s fine. Also, in the US your carrier gives you a highly discounted update to the iPhone coming out that year at the end of your contract to lock you in for 2 more years. If Reliance offers something similar then also the deal is great. Remember, a 2 year old iPhone can be sold for secondhand for 50-60% of its original price.

    • Charges after the offer are Rs. 1499 per month, for the same offer. But there’s no mention of 4G etc.
      Yes of course, things are different for different users. The 2 year old iPhone resale value might change in India once deals are more common, but then the ecosystem in India for apple is tiny compared to the Android system, so prices could still stay high.

      • hrpanjwani says:

        Thanks for the clarification. But can I switch away from unlimited plan after 24 months?
        I think the resale value will stay high quite simply because of the build quality and usability of the iPhone. I have used touchscreen phones here that are around 18k and they have quite poor touchscreen performance. Once the price drops below 12k it is simply unusable.

        • I think you can switch away after 24 months, even away from Reliance (Another post on that).
          I might agree with you on the resale value, but having used this Micromax phone (14K) with a quad core processor, HD display, 5 inch IPS screen and remarkably good touchscreen, I would honestly disagree on the cheaper phones not being usable front. But then, if you have other people who agree with you, they’ll pay more to make for the resale value!

        • hrpanjwani says:

          Yup switching away after 24 months is a given. Basically, it looks like they are going very close to the US contract model with the exception that after 24 months the carriers there don’t lower prices as they want to lock you in with a new phone with a new contract. They can do that as the phones sold in the US are locked to the carrier (This is changing now but the official unlocking process remains quite tough for a person who is not tech savvy) but phones sold in India have to be unlocked.
          An important part of the resale is making sure you also include the box, original accessories and documentation, an Apple sticker (original purchase comes with 2 of these) and maybe a used case. I sold an iPod like this, got 60% on original price back. 🙂
          Thanks for the info, looking forward to your next post.

        • Snowy says:

          iphone in India seems like it has high resale value because its priced higher to start with. And also the ones looking for an Apple product would have set aside a good amount of money for this and dont necessarily look for features they get for their money.
          And your second statement about build quality is true if you compare iphone with 2nd grade brands like Micromax, Karbonn, iballetc. even LG. But cant say the same about the smartphone offerings from Nokia (Nseries and lumia), Samsung (galaxy s series), Sony (xperia series) as they all have the same great build quality like the iphone. My primary phones are a Nokia N8 and iPhone 4S 16Gb and I didn’t find any difference between these phones in terms of reliability or build quality, also the touchscreen performance. Usability depends on the OS and Apple here has a simple easy-to-use interface for an average smartphone user while Nokia on the other hand with symbian provides lot of customization options for a pro user. I have also used (and sold off!) other low end touchscreen phones like Samsung Monte, Moto Defy and Intex Aqua and these phones were sluggish with flimsy build quality and touchscreens similar to sbi atm’s :p

        • hrpanjwani says:

          Hi Snowy,
          My digital world become Apple centric after I spent some time in the US. There Apple is quite simply the undisputed market leader in providing good customer service with excellent devices. In practice this means I can do my work without worrying about my machine breaking down and in case it does break down very badly I can even get a free replacement device to use for a few weeks while they repair my machine. At Apple franchises here in India, understandably the service is not at the same level as it was in the US but my experience with them has been good.
          All in all, I have not had any compelling reasons to step out of the Apple universe after coming back to India and contract deals like this one just cement that position further. My phone before I left for the US was a Nokia as well 🙂 , it was a well built device. Today if I were to switch away from the iPhone, I would seriously consider HTC for a mid level device or a Nexus at the high end.
          In the end, YMMV depending on how much you can afford to invest in electronics, what you are looking for in a device as far as personal/work use go and how tech savvy you are. There was a time when I enjoyed messing around with Linux distros but now I care a lot more about my productivity. At present, it means sticking with Apple products for me. Cheers.

  • Pranav says:

    I appreciate the analysis. Just a couple of points
    As per the FAQs on the website, the phone doesn’t come with a sim lock. So there is absolutely no need to use it on a reliance sim at all. One is free to use it as he cares
    I agree fully with your credit card limit analysis and that anyone who can afford the phone and block the limit can get an EMI scheme in any case and it won’t be much more than the amounts in this offer.
    It may be difficult and time consuming to get rid of the service after 24 months considering the reputation of mobile phone providers and experiences heard from those who ported their number.

  • vivek says:

    Very good analysis 🙂

  • Mansoor says:

    Nice article friend.. It’s jus a eye opener for us. V people think in short term. But when v actually analysis for long term , it’s totally waste , becoz technology s updating every 6 month. If v buy this phone , it’s mean v have to locked with one service for next 2year. Reliance has made a smart plan , so plz think 10 times b4 hitting to store…

  • Murty says:

    Deepak,
    let me refresh your memory. Lets go back to 2003.
    Reliance Communications introduced a similar scheme, offering a small piece of instrument for Rs3000 odd , and played havoc with thier billing woes, and threatening people with arm twisting, and even rowdy gangs. In Hyderabad, we formed a REMOVA….. read it as Reliance Mobile Victims Association, but later the leading lady of the association was silenced with we do not know what……. we were literally fighting with Reliance outlets, with our billing woes…..finally they threatened with legal notices, recovery agents and what not…..At the end we understood that Reliance already insured these instruments and got the money long tie before we stopped using them. It was heard in those days that there were lakhs of such instruments dumped into the sea… you know what the insurance can cover….RELIANCE IS THE MOST CHEATING COMPANY IN INDIA….
    Please advise others not to fall prey for these gimmics……. They are all looters….. It is public looting……. It is fraud……. oNo one bothered then and no one bothers now!

  • Salman Ali says:

    For those who dont want to buy an iphone, well, it might not make sense
    But those who wants to buy an iphone, this deal makes sense.
    Why? See below for my counter analysis:
    If you want to buy upfront you’ve to spent 53500, and here you’re paying 72000 in installments over two years. 3000 bucks a month is not a big deal even for an EMI scheme (You’re just paying the cost of couple of dine-outs a month)
    But, if you break the numbers, as the author did, it cost 62000 bucks (plus 15% interest) upfront (as that much amount is blocked in your card). i.e. 8500 more than the actual market price.
    But, wait:
    What you get for 8500 is unlimited calls/text/data for the next 24 months; i.e. roughly 350 bucks per month. Even an average smart phone user will be having a much higher outgo on his/her mobile.
    Now, the good thing here is that, you’re not actually paying out 62000, neither 72000, nor 53500 from your pocket to get the deal. All you do is that paying out 3000 bucks a month, i.e. say twice your phone-bill every month (or say thrice); which are paid out as an outgo as you might not even notice.
    And, this phone is an unlocked phone. Only the contract to be on reliance network for 24 months is obligatory. Phone is yours and you can do what you want.
    Regarding resale value, or expecting iphone 6 or 7, etc.;t hats a very stupid argument. Tf these were the barriers, the sales of iphone 5s or any other smartphone across the world would be zero. People, or at-least early movers, find a value in a class product which micromax users like the authors can only overlook.
    Even the author is suggesting somewhere down the line, one should go for 53500 if he/she is really interested, which is where the nonsense lays.
    Bottomline: If you want to own a 5S, this is a great deal. If you dont want, thats a different case, which has nothing to do with the deal.
    Hats off to reliance for coming up with a win-win deal (which is actually the norm in US/Europe/ME or elswhere for higher end smartphones).
    Cheers

    • Good set of points, but the fact that 3000 is just two dinners out is not tenable – this is a financial analysis, and I could bring everything down to a few dinners out and it would seem fair. This “value in a class product” etc is a different argument – there’s much better products out there in my opinion, but like I said if apple appeals to you, it’s your money.

  • Naveen says:

    Nice analysis covering all points. As you said this phone is only for Apple fans.
    EMI or no EMI scheme, it does not make any economic sense to buy a phone that is as much worth as a decent two wheeler. I don’t think anyone uses his smart phone for more than 2 – 4 years.

  • Md. Eyakub Ali says:

    Very good analysis..
    But I just wanted to know in details about 3g unlimited plan.
    Is it fully unlimited or have any data usage limit?? Or have any bullshit data bandwith deduction??
    I am using BSNL Broadband combo plan(2am-8am unlimited), which cost me approx Rs 600 per month.
    My average usage 50-80gb per month. If it is fully unlimited as claimed by Reliance, then the plan is really cheap. Normally they cost 1gb 3g data of Rs 124.

  • jim says:

    Restaurants offer Rs 350 Unlimited thalis for a reason. There is no free phone here. I am almost certain that you cannot download unlimited 3G. Imagine downloading more than 10GB on your phone. it will most certainly die soon especially with no SD card. The phone will be locked to reliance whims. You can do nothing about the quality. Unlimited calls. Yum. Finally, the handset itself is not the greatest. So if you would like to be stuck for a whole two years with this iphone then go for it. Every six months people mock other iphone users with a new iteration so better beware. Also, there will be no warranty after year 2. Dunno what reliance will do with the plan if it breaks down. Worse if stolen.
    Howsoever good it may appear, I would certainly alert people to form no long term partnership with Reliance. So 2 years would be a very long time. not only are they extremely poor in customer service I could not get service in dadar area and they told me its not an important location for them??? that silly – now I am in vashi – no 3G in different rooms.ya you might get it

    • jim says:

      i meant warranty of 1 year. someone just told me that they can sell this used iphone after 2 years and get 20,000. Imagine in 2016 you try to sell iphone 5s for 20,000 locked to reliance when iphone 10s. someone was even more ridiculius suggesting that reliance will offer a great buy back scheme. sounds insane that someone who knows above will offer 20000

  • Raghavendra Shenoy says:

    Excellent post, summarizing the offer, pros and cons. Many readers have spoken of Reliance Infocomm’s Monsoon Hungama offer that failed miserably and forced the firm to write off large sums of money. I think they’ve learnt from this and have basically transferred the risk to a third entity. Comments and views on Reliance’s network, resale value of the phone 2 years down the line, non availability of 3G all over (which means this sale can’t be a pan India offering) apart, few things stand out as differentiators from the Monsoon Hungama offer
    a. Offer is not available to the aam admi’s who have a credit card limit of <50k, who do not have a card and to people who hold cards from PSU banks(assuming their assessment criteria for card issuance isn't as strict as the pvt banks). This effectively shunts out a large portion of the market size, and also the risk of the phones ending up in the sea or elsewhere.
    b. As you pointed out, RCOM gets ~60k upfront and does not carry the risk of default. From a risk management perspective, this is critical and taken care of.
    c. Monsoon Hungama was about getting subscribers on board ASAP at any cost and hence every bai, autowallah and blue collar workers were target customers. The current offer is an attempt to make inroads into the creamy layer who use voice and data, and are aspirational about flaunting an IPhone.
    d. Further to your explanation about the deal, in a very very crude way; this is like the doodhwala handing over prepaid coupons at the beginning of the month in exchange for the cash we pay him and providing us with packets as per requirement. He collects cash upfront and will use it to pay the milk co-operative. Basically, use my money for his business. :). If he runs away, i am the loser and not the co-operative.( In this case loser is not RCOM, but the customer and the bank).
    Good one, again.

  • hemant chhajer says:

    facts confirmed:
    this is truly unlimited. unlimited calls, sms (3000 per month), 3G data(yes, no FUP, this is awesome), unlimited national roaming incoming and also outgoing.
    device is not locked. yes this also true. u can buy iphone 5S/C and immediately sale to other(if u not want) with box pack condition and use that reliance sim card in android mobile for truly unlimited, awesome. u can online apply for gold champagne color easily in ₹2999 for some cities.

  • lakshman says:

    This is not a good offer. Sony z, z1 phones latest high end technology phones with double the features of iPhone, and priced around 40000 and 25000 which is more worth than this offer. I did prefer Sony phones rather than iPhone offer.

    • Mike says:

      Well, iPhones are yesterday’s technology with tomorrow’s prices. The people buying this device is mainly to show-off just like with any other tech devices. So value for money is not something you should look for in an iPhone as the features will be mediocre. I have an iPhone 4S, Nokia N8 and Xperia Arc S; and 4S was the costlier gadget among the trio but an underdog when it comes to features. Some say iPhone has better build quality and reliability to justify the higher price point, but I didn’t find any difference when comparing to these high end devices from other manufactures. Sure, it have better build quality if we compare it to mid end devices like Samsung champ, Lumia 620, Xperia U,P, etc..

  • Manoj Nagpal says:

    What’s the catch in this analysis, which Deepak Shenoy has missed?
    If you are anyways going to buy an iPhone 5S / 5C (which lot of people are buying going by the demand seen Source: http://www.dnaindia.com/scitech/report-apple-gets-india-in-line-massive-queues-to-buy-iphone-5s-and-iphone-5c-on-the-day-of-launch-1912766), you have three choices
    1. Buy an iPhone straight off (Pay 53,500 upfront for the 5S). Pay for the usage separately
    2. Buy iPhone + 50% discounted plan from Airtel
    3. Buy from Rcom with no bills for 2 years and unlimited usage. You can either pay EMIs of Rs. 2999/- for 24 months or if you have the cash pay Rs. 66,000/- upfront.
    Let’s assume that you decide to pay Rs. 66,000/- upfront (for the sake of simplicity to get the EMI out of the picture, which confuses the real economic value for a lot of people)
    You can roughly break it up as follows
    Unlimited Usage for 24 mths (including service tax): ~Rs. 29,000 (say 1200*24)
    Your net cost for the iPhone handset: ~ Rs. 37,000/- (i.e. 66000-29000)
    After 2 years you may be able to sell the iPhone 5S for between 30%-50% which is the current trend i.e. between Rs. 17-27k, if you decide go in for a new iphone 6 or 7 (which may be available then)
    So your final cost for the iPhone 5s handset is between Rs. 10k (best case) to Rs. 20k (worst case) which is a sweet deal. You need to take the re-sale value also into picture because as Deepak is comparing it to his Micromax which may have a 10-15% re-sale value after 2 years. So to do a fair financial analysis, the approx re-sale value needs to be taken into consideration, which actually tilts the deal in favor of iPhone deal.
    Whether you like it or not, for an Apple fan this deal is as good as it gets. The only risk you are taking is the service of Rcom, which may put off some people.
    If you are not an Apple fan, then obviously all these geeky numbers don’t matter and you can be happy with your current phone and your current plan.
    But to fair Rcom has put out a good deal and this will surely change the way people buy phones in the future.

  • Pranav says:

    Good article, but a lot of points aren’t making much sense to me.
    Now I won’t contradict everything you wrote. I do find some good statistical research done. Let’s just focus on the summary.
    The main points written were that you should get this deal only if you:
    1. really want to buy the iPhone 5(S or C), and
    2. don’t mind switching to the Reliance network, and
    3. don’t care about upgrading your phone for two more years, and
    4. don’t want 4G LTE for free when it comes, and
    5. don’t have a problem with the limit getting blocked on your card, and
    6. can afford this EMI
    1. really want to buy the iPhone 5(S or C).
    What does the first point even mean? You should buy a product only if you REALLY want to buy that product? Doesn’t make much sense to me.
    2. don’t mind switching to the Reliance network
    Why would one mind switching to a network which is offering them much more than other networks at better rates considering they’d let you keep your phone number as well? (And by personal experience, Reliance does have a better network stability than Vodafone and Airtel, at least in Delhi)
    3. don’t care about upgrading your phone for two more years
    This point is somewhat valid, because all this would mean is you get stuck with the same network for the next two years. The sadder part, you pay your phone bill even if your iPhone is lost or stolen.
    4. Don’t want 4G LTE for free when it comes? Who is offering it for free?
    5. don’t have a problem with the limit getting blocked on your card
    The limit getting blocked on your card is a much smaller issue. If you are planning to get this deal, I doubt you’d be giving that much weighting to your limit being blocked. Even if you buy an iPhone from the apple store directly, this is something that’d bug you (i.e. if you use your credit card for purchase, which most of us do.)
    6. can afford this EMI
    This last point is definitely something to consider. Don’t just go blindly to the Reliance store and ask for an iPhone. Do calculate all the costs you’d have to pay. And don’t ignore the additional conditions applied.
    So, overall, this scheme is really something to be considered if you want to save your money, buy an iPhone and are ready to switch to Reliance.

  • Saurabh says:

    As pointed out by others as well as mentioned on official Rcom website, the phone is unlocked. User can use the phone with other connection, likewise Reliance bundled connection can also be used with other handsets (except dongles).. The author of this article should correct the same in the article..

    • Pranav says:

      Even if you decide to change to another service provider in these 2 years, don’t forget that you’ll still have to pay the monthly reliance bill. So changing your network after taking this deal is outright foolish.

  • Murty says:

    Deepak,I foresee similar problems we faced earlier. The EMI in 2003 was all inclusive, but later the call charges were added. Fine, you talk more and you pay more. But the Billing software woes will repeat again. This is a RED warning! You just wait and see.

  • Sanjay Puri says:

    The deal offers value for money for high voice and data users. For those having a bill of Rs. 1500 and above the effective extra amount is just Rs. 1100 or 1500 per month depending on the model.. Which is worth it. Moreover since the 3G is free one can reduce or stop the home WiFi which can at least save further Rs. 500 to 600 per month. The handset can be used as a WiFi modem and through tethering other user can also avail the internet facility. Thus the effective price is only Rs. 500 to 1000 per month or 12000 to 24000 in two years depending on handset choice of 5C/5S 16 GB
    Further for people on the move this plan also reduces the bill by offering free roaming.
    Now only thing that could be a point of concern is the services and network coverage with 3G availability. For individuals living in Metros like Delhi should not be a problem.
    This is good and tempting scheme for high voice and data users.

    • People who recommend removing home wifi for this – please note that 3G in no city is fast enough to replace home wifi! (I use 3G in Delhi/Mumbai/Bangalore)
      Even then, it’s not about the perceived “only this much extra”. But yes, unbundling into a phone plus unlimited offer gives you a great unlimited offer for a very low price (assuming you value the phone at 47 K)

  • Thiru says:

    Nexus 5 is out and already sold out which is 30K. May have to wait for few days to get it back.
    https://play.google.com/store/devices/details?id=nexus_5_black_16gb

  • Glen says:

    Thanks a lot.
    I am in need of a good phone and was thinking about the iphone given the premium brand and they fact that you can actually pay EMI and own the phone.
    After reading your article i have decided to forget about it.
    Thanks for taking the time to open my eyes.

  • richa arora says:

    deepak shenoy ji pls can u tell me that what is the procedure of buying iphone with the reliance scheme…..bcs procedure is not given on whe websites i checked…. so pls rply fast nd its a gud scheme

  • Rupesh says:

    Is this is a good deal for people whose monthly bill is around 3200 (calls+data+sms+roaming+isd). I understand ISD calls are not a part of this deal.

    • I think so, with that kind of bill! Especially if you are using or roaming in areas where Reliance has 3G. I don’t know about the reliability of the Reliance 3G network but that is obviously something you have to experience to know.

  • rikkuartz says:

    thank you for the article.. good information

  • Somnath says:

    Excellent review. What happens if I miss an EMI? Will the card levy interest (annual rate) of 35-44% on the outstanding EMI?
    BTW, in the 2000 launch, Reliance did not take a risk by offering handsets at Rs 500. They insured the handset and even possible bill dues, with National Insurance Co. So NIC had to take a hit of nearly Rs 130 crore!

    • 1. If you miss an EMI, you’ll pay the card interest rate which can be very high as you’ve noted. Not only do you pay that, you also pay interest on any OTHER purchases you have made in the same billing cycle. Read: The Good, Bad and Ugly of Credit Cards
      2. I remember – and that’s why NO ONE in India will insure handsets anymore. Which is why Reliance had to do this EMI thingie with credit cards, where your incentive to default is lower since the bank will come after you.

  • shree says:

    Hi,
    yes i do agree with author analysis. but i want add some controversial points to it.
    1. author saying that down the line 1yr we ll get 4g the 3g will get for reduced rentals. yes may be, but jus for example 3g launched in india about 3yrs ago, still we doesnt have full 3g network in all the areas atleast most of the areas. so think about 4g to come with full signal. even if 4g comes i dont think 3g will come for 100rs or so b’cuz right now 2g (for 1gb) u need to pay 125rs at least in NCR, and mumbai with vodafone.
    2. even if i apple come up with iphone 6 or 6s. at most they will come up with may be of larger screen, HD or Full HD resolution. but not any new invention. why because present they dont have these two only. apple always come up with 1 phone per yr. so we cant expect some drastic changes in further phones. for instance see the changes from Iphone 4 to iphone 5s, these two have almost 3-4 yrs.
    3. many people rised the question about resale value.. you’ll get good resale value.. cz iphone 4 is only the practical example.

  • utsav says:

    Thanks for the heads up!! Fantastic insight….m NOT buying this phone now…why to pay extra 24k to a bank !!!..
    Thanks!!

  • Sudeep says:

    I still dont get it ..
    Whats so wrong about this offer ..
    Except that you are stuck with rcom for 2 years..
    1. Total cost of device is 53500
    2. You pay 2999*24 = 71976
    3. So subtract 53500-71976 = 18476
    So you are paying 18476 extra!! No but you get free calls and data, sms for 24 months
    18476/24 = 769.84 Per month you pay extra !!
    I anyways get 1000 plus for voice calls and data for a month… So even after all the interest and what not i am actually paying retail price for the device plus Rs 770 Extra a month which has interest rate and voice calls included .. So i still do not understand whats wrong ?? Expect you are stuck with reliance ..

  • Kiran Thomas C says:

    Buy iphone 5c and 5s from Ebay, you will get a lot more cheaper.
    The only good thing about this offer is you get free talk time local, STD for 2 years, free sms and 3G usage. But 3G usage the battery will die quickly. Actual cost of the iphone which the dealer may get is around 35-40K and reliance is selling for more than 20K, they get their double profit before you use this phone.
    Another negative here is it will be locked to reliance network, which you cannot use with any other network. I guess only it will work with CDMA and no GSM. You will find hard time to sell this phone, even if you jailbreak it, many restrictions will be there like outgoing SMS may not work, 3G will not work etc.
    I will never buy this phone, I am happy with my iphone 4s which I bought in India a year back, and I am a great fan of apple phone, I don’t think even consider buying any other phone for the next 5 year.

    • Sudeep says:

      Hi
      1. Dood Iphone 5S in India is launched for GSM got it ??
      2. The phone you buys is unlocked , that is use it with any sim no one cares ..
      3. So no restrictions whatsoever ..
      So dont buy it if cannot afford it ..

    • Sudeep says:

      Of course i forgot send me to a link on ebay where you get iphone 5s /iphone 5c for less than the normal cost(showroom price) with 1 year apple india manufacturer warranty and i will reimburse the balance amount to your account ..

  • srv says:

    dear sir,
    thankq soo much for open my actully closed eye’szzz. i gonna mad for dis ph. and after rcom instalment plan any body can be easily go for them…
    bt after read ur article i changed my mind..soo which is best for me…..

  • Surinder Dhaul says:

    What about others ifthey dont have credit card

  • I am currently using Airtel 3G service and is not satisfied at all .I have made number of calls for the 3 G service interruption but of no use.
    I would like to change it to Reliance in any case.
    Airtel is not even botherd to look at the grievances.

  • Ravi Shankar says:

    Really, this article is very helpfull.

  • Sona says:

    Where we can book this phone

  • Mohammed nawaz says:

    If you know whats pure pleasure, class useage, and fine technology with premium lifestyle feel and material useage, you buy apple. A poor man cannot simple have an elephant pet. So dont fall prey to these offers if you cant buy. Reliance is a rip off in this offer. If you cant afford to buy an iphone with onetime payment its simply not for you.

  • Gov says:

    Excellent analysis…!!! Thanks for the article…!!!

  • Dhruv says:

    can i get iphone 5s 16GB golden color under this scheme?

  • Anand says:

    Unlimited 3g data is the biggest catch in this deal. If I consume more than 1 GB of data per day ,it would have cost me 123 per day,approx 3700 rs per Month. Heavy downloaders can make reliance cry using this offer

  • Simerjit Bedi says:

    Sir, first of all the phone is not locked. You guys can check the website if you want to so you can change the sim card whenever you want.Secondly 3g is much better than a broadband connection in a city which has a good 3g connection you get 1mBps download speed don’t get it confused with the connecting speed the connecting speed is upto 7 mbps it is way much faster thn a broadband or for example you can download a blu-ray print movie in 45 mins can you do it with a broadband connection which is not less then 1500 p.m? try it. This deal is only good for those people who dowload more thn 30 gb of data in a month. That’s why I bought this phone and I am using the reliance sim in my android phone so I can tether it to my pc and download stuff.

  • Simerjit Bedi says:

    This is just my data usage 2600(30gb p.m) * 24 = 62400. Now you can calculate yourself and see that the deal is totally awesome.

  • Raj Singh says:

    Good Analysis.

  • Akhil Mohammad says:

    Thank you very much!!!!!:)

  • Haris says:

    Great Analysis sir, covered everything I was looking for.
    Thank You

  • raj says:

    hi all i think u do not know the real fact

  • raj says:

    its not a deal they have not specified the down payment of 120000 any ware i went there they told me that the down payment of 12k is needed so now the cell goes to 86 thousand for 16gb or 3500/- per month is u do not want to pay the down payment

  • raj says:

    its not a deal they have not specified the down payment of 12k any ware i went there they told me that the down payment of 12k is needed so now the cell goes to 86 thousand for 16gb or 3500/- per month is u do not want to pay the down payment

  • Sunny Kumar says:

    Dear Sir,
    I want a I Phone 5c interested in installment plz give me the rate per monthly installment details me.
    with best regards