Why is Reliance Jio so affordable?

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Today at Reliance industries AGM Mr. Mukesh Ambani announced the launch of Reliance Jio on 5th september. The main highlight of this announcement was the lowest tariff rates of Jio services in the world. Jio will provide 1GB of 4G internet for as low as 50 rupees. And with free night usage you can get the cost to as low as 25 rupees per GB. Also free voice calls for life and extra 25% for students.

Reliance JIO tariff

Now the first questions that comes to anybody’s mind is “Why is Reliance Jio giving away its services for such low prices when it can charge a much higher amount.” The answer to this question is Data Mining.

What is Data Mining?

“Data mining is an interdisciplinary subfield of computer science. It is the computational process of discovering patterns in large data sets involving methods at the intersection of artificial intelligence, machine learning, statistics, and database systems.

How is Jio going to benefit from Data Mining?

Since Jio services are so cheap a majority of customers are going to flock at Jio stores to buy their Sim or Wifi Devices. This means that from a small labourer to a large business everybody is going to use Jio. Now with such a large customer base Jio will have a ton of data on how people spend their time on Internet. What products do they like, What movies or TV shows they watch, What do they do on Weekdays or on Vacations, What clothes they like to wear, What food they like, Etc. Even the Jio app suit which consists of Jio Chat, Jio Play, Jio OnDemand, Jio Beats, Jio Mag, Jio XpressNews, Jio Drive, Jio Money, Jio News are all designed to attract customers to use them instead of any rival services. These apps will provide Reliance with lots and lots of Data about customers likes and preferences.  This data is very important for business. Today businesses pay a large amount of money for data which help them to take business decisions like what products to develop or which services to provide. Have you ever noticed google shows you ads which are tailored for you. For example try looking for a mobile on Amazon and then visit Google or any other website that has ads from Google. You will see the mobile you searched on Amazon in those ads. Google tracks your every click on the internet, whether it is on a computer or mobile phone, and creates a database of your preferences.

Imagine a billions people using these services. Imagine the amount data Jio servers will aggregate. Reliance will sell this data and information collected from these data to other businesses and earn billions of Dollars.

Jio by keeping low tariffs is just passing a fraction of the benefits they are going to get back to us.

Does that mean we should not buy Jio?

No, Jio is offering the best services in the industry and will definitely revolutionise Indian Telecom Sector once again. Now with Jio we can truly say that India has the lowest tariff rates in the world. With this a large chunk of indian population is going to get internet access which is great. Like everybody I am also going to stand in line for my Jio Sim.

Is data mining bad for us?

We should be careful sometimes because companies sometimes influence our decisions and when they know so much about our choices and habits that process becomes even more effortless for businesses. You can not protect your self or your data from data mining. It is important. Data mining holds great potential for the healthcare industry to enable health systems to systematically use data and analytics to identify inefficiencies and best practices that improve care and reduce costs.  Some experts believe the opportunities to improve care and reduce costs concurrently could apply to as much as 30% of overall healthcare spending.  This could be a win/win overall.

But again people always try to influence others. We should always make informed decisions.

One thought on “Why is Reliance Jio so affordable?

  1. Interesting write-up. I believe that the next thing that should be regulated heavily and honestly is the data that such companies utilise. Customers should be made readily aware about such practices and should have a choice before opting into services.

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