Why Airtel's iPhone 7 at Rs 7,777 is not a steal

Telecom giant Bharti Airtel launched its new online store on Monday in a bid to enhance its digital presence across the country. Much like its counterparts in the US, Airtel is offering through its online store premium smartphones with affordable down payments, instant credit verification, financing and bundled monthly plans.

Currently, Airtel is offering the iPhone 7 and iPhone 7 Plus via the store, but it plans on adding more devices from leading brands in the coming months. 

What are the offers?

The iPhone 7 variants can be bought from Airtel's store starting at a down payment of Rs 7,777 for the 32GB variant and Rs 16,300 for the 128GB variant. The iPhone 7 Plus variants are available at a down payment of Rs 17,300 and Rs 26,000. 

But there's a catch. Under this offer, the phones will be locked to Airtel's network and the customer will have to make monthly installments of Rs 2,499 for two years that will also double up as a high-end postpaid plan which offer 30GB of data, unlimited calling (local, STD, national roaming), and Airtel Secure package that covers the device against physical damage and cyber theft.

Why this is not a great deal

Like they say, the devil lies in the detail, and a break up of the numbers reveals that regardless of the device of choice, the customers will be paying a hefty premium on the price they can get the phone for in the market. 

For starters, the same 30GB data plan that is clubbed in the Rs 2,499 monthly payment can also be taken separately for as little as Rs 649. Deducting that from the monthly installment leaves us with paying Rs 1,850 every month as an instalment for the phone over and above the initial downpayment. 

Thus, for the iPhone 7 32GB one will end up paying a total of Rs 52, 177 (7,700+ 44,400) for a phone they can get for as little as Rs 38,999 on Flipkart right now. The profit margins for Airtel remain in the same ballpark for the other three phones too. 

Granted the offer makes paying for the phones easier through small monthly installments, but the same can be achieved by opting for no-cost EMI options available at the time of purchase of the phone. 

So in all honesty, these new offers are just more of the same that have been dished out by Airtel in the past. Unlike carrier locked phones in the US which come with attractive bundled plans designed to benefit both the carrier and the consumer, these offers by Airtel do not translate in cost benefits for the customers. 

If anything, they are designed only to benefit the telecom operator, Airtel. So, if you're in the market for a new iPhone 7, it will be best if you steer clear of Airtel's offers, which quite frankly offer nothing new or interesting.

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