Flipkart May Shell Out INR 8.8 Cr. Every Month On Airtel Zero?

It’s heartening to see such an open support for Net Neutrality in India among netizens. While on one hand, Telcos are looking to charge us differential (read higher) pricing for some services which they believe may affect their direct revenues (not entirely true because data revenues have better margins for them), on the other hand services like Airtel Zero are positioning itself as a great consumer service by making it free for consumers to browse certain Apps.

I decided to do a quick analysis to ascertain what it takes for a company like Flipkart to be a part of this Airtel Zero platform and why it is grossly unfair for less funded companies in the similar space.

Look at the table below — Flipkart may end up giving 8.8cr to Airtel every month. Makes a great business model for Airtel — isn’t it?

Assumption 1: Industry avg say 40% browse popular apps on Wi-fi. Airtel being the largest Telco may have 33% share among all Telcos = 20% overall.

Assumption 2: Each session user may end up checking 10–15 items with pictures & other content consuming 20MB average.

Now please decide if any startup can afford to pay anything close to his?

Hope all of you have read this great article by Nikhil Pahwa on how Airtel Zero is going to change the internet landscape in a negative way. Here is the story: The Airtel Zero idea: Splitting India’s Internet into many Internets

I will be happy to hear your feedback on this. Feel free to comment here or tag me on twitter @deepakabbot or mail me at dabbot@gmail.com

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