Home

Who doesn’t like freebies–and in today’s economy? 

In July 2025, Bharti Airtel announced that all of its active users—mobile and broadband—could unlock a yearlong free pass to Perpexity Pro. That’s worth approx. ₹17,000.

Months later, in October, Google partnered with Reliance Jio to offer Jio’s Unlimited 5G users 18 months of free access to Gemini Pro (now with Gemini 3 included). That’s worth ₹35,100. 

Both out of pocket. Not cheap giveaways.

OpenAI joined the party in November, doling out free ChatGPT Go subscriptions to millions of Indian users.

But training large language models (LLM) is pretty expensive, and running them is even more so.

Then why are these Big AI companies, which are yet to mint profits, giving this VIP treatment to Indians? Is distribution really that important?

The Freemium Gold Rush: Strategy, not Generosity 

First of all, do NOT even consider this a charity of some sort. The intention behind these moves is a carefully built business plan to grab the bigger pie of India’s digital user base–one of the largest and fastest-growing across continents.

The Power of A Near-Billion User Base

It’s simple mathematics. India is a massive market. And AI needs users. The country currently houses over 95 crore (950 million) Internet users, a number that’s growing at 8% year on year (y-o-y). Not to mention, people here enjoy some of the cheapest Internet plans worldwide. 

A major chunk of India’s digital population comprises twenty and thirty-somethings. The age group that lives, works, and socializes online. As such, India offers a perfect environment for testing and scaling AI services.

Indians Just Love Freebies: History Rhymes

Remember how Jio shook India’s telecom market in 2016 by offering customers about 6 months of free 4G data and voice services? Big AI companies are rolling a similar dice. They know that Indians are price-conscious. Whenever they get a whiff of discounts from any store, they flock to that store without thinking twice. 

In a similar vein, offering free, easy access to Gen AI tools opens the door for millions of users here. 

How? Either by joining hands with telecom giants and bundling their Gen AI tools with the Internet plans you already use (like Jio-Gemini and Airtel-Perplexity) or simply removing the paywall for a limited time (like ChatGPT).

As such, the Big AI companies don’t need to convince everyone to sign up for their LLM apps one by one. This is the fastest way to bring the product within the fingertips of the masses. 

Free Now, Pay Later: A Gateway to Mass Sign-ups

The Big AI companies are making these calculated investments as a long-term bet on India’s promising digital future. The idea is to get Indians hooked onto Gen AI before asking them to pay for it once the free period ends. Because it will end.

But why not China, an even bigger market? Well, China does have more Internet users than India, but its heavily regulated tech ecosystem limits foreign access. India, fortunately, welcomes foreign tech companies with open arms, and Big AI is pouncing on the opportunity to lock in millions of users here to train their LLMs.

So, what happens after the free trial ends? Of course, Big AI will unlikely slap users with expensive subscriptions but can rather offer low-cost, value-laced plans. Similar to how Jio went for the kill after it got the nation hooked to its network in 2016. 

But then many away users will shy away from renewing their subscriptions. They’ll either wait for alternatives to show up or sneak out ways to continue the free trials–using a different mobile number or email ID. The “Great Indian Jugaad,” as we proudly say with a smirk on our faces.

Still, India’s sheer volumes offer huge promise. Even if 5-6% of users nod to pay for subscriptions, let’s say, that’ll still bring a respectable revenue.

Train the Gen AI Brain: The Real Scoop

India’s real strength lies in its incredible diversity. 121 distinct languages and thousands of dialects. We are a “masala mix” of ethnicities, languages, mindsets, and cultures. 

When an Indian user enters a prompt into a Gen AI tool, it could be in English, Hindi, Bengali, or even Hinglish (“Bhai, give me some quirky one-liners on Holi”). The question could come from a college student in Tamil Nadu or a grocery store owner in Rajasthan. 

Every such valuable interaction enriches the datasets, which makes these LLMs better understand local behaviors and cultural nuances and become more accurate, inclusive, and reflective of diverse perspectives. The more unique and raw data AI companies get, the smarter their LLMs will become. 

Actually, the heart of these Gen AI systems lies in the interaction layer: getting prompts from users. They analyze usage patterns, error correction, what people ask for and how they do it, what media they upload, and how the model functions across contexts. 

That’s the data goldmine that AI companies are digging to refine future versions of their LLMs for Indians and people around the world. For them, training Gen AI systems on data generated by Indian users is a critical stress test that will help them iron out complex communication patterns.

In a nutshell, if a Gen AI tool can work well in India, it can work well anywhere.

The Plan Has Worked Already

These moves by Big AI have done wonders so far. 

Following its limited-time offer, ChatGPT’s daily active users (DAU) in India soared 607% y-o-y to 73 million during mid-Dec 2025. This number has further clocked 100 million in Feb 2026.

Gemini and Perplexity also tasted a similar success. Gemini’s DAU in India rose by 15% since its deal with Reliance Jio kicked off. Similarly, Perplexity quickly hit the top spot in the iOS App Store in India right after partnering with Airtel. Moreover, India now makes up for over a third of the San Francisco-based AI startup’s global DAU (as of 2025), a considerable leap from 7% in 2024.

On Route to Becoming the Global Bot Training Capital 

India’s AI market will likely clock US$17 Bn by 2027, riding on the triple forces 

of digital fluency, youth, and rapid adoption. Big AI players aren’t just building a user base; they’re building a data and cognition infrastructure trained and run by human emotions at a national scale. They’re betting on a market that promises unmatched scale, diversity, and ROI over the long term. 

Right now, India is that race track where the Big AI players are toiling hard to outpace each other. Whoever crosses the finish line first on the Indian track might just win anywhere in the world. Time is supreme.

Rapido has already hogged the news headlines with its food delivery venture, “Ownly,” aiming to challenge the Zomato-Swiggy duopoly.

With a pilot launching in Bengaluru soon, Rapido’s Ownly is luring in restaurants and consumers with two key value propositions: a flat-fee structure and transparent meal pricing.

This hints at a potential shake-up. But is it a walk in the park or a walk into the storm? Why has no other player been able to pull this venture off successfully yet?

In this article, I’ve answered these questions by explaining what’s driving Rapido Ownly’s proposed model and what roadblocks it can stumble upon.

Read the analysis!

Firstly, Why Earlier Ride-Hailing Biz Failed?

Before Rapido, Ola and Uber attempted to shake the Swiggy-Zomato duopoly with Ola Café (acquired Foodpanda India later) and Uber Eats India, respectively. Additionally, Amazon Food and the government-backed Open Network for Digital Commerce (ONDC) faced the same fate.

Ola Café, Amazon Food, and Uber Eats India fizzled out within a few years, with Zomato buying out the latter.

Most of these haven’t been able to grow due to limited restaurant selection, inefficient last-mile logistics, bad customer experience, and operational complexities.

While Ola has partnered with ONDC—its food delivery service “Ola Dash” now runs on the ONDC platform—it’s yet to match the success of Zomato and Swiggy.

The Rapido Advantage

Restaurant-Friendly Three-Tier Pricing Structure

Rapido has categorized its delivery fees into three distinct layers:

• Order value over ₹400: Flat delivery fee of ₹59 (₹50 + 18% GST) to be paid by partner restaurants.
• Order value ₹100-400: Flat delivery fee of ₹29.50 (₹25 + 18% GST) to be paid by partner restaurants.
• Order value below ₹100: Cross-subsidizing—partner restaurants will pay ₹11.80 (₹10 + 18% GST), customers will pay ₹23.60 (₹20 + 18% GST).

Now, let’s compare this flat-fee model to Zomato-Swiggy’s commission-based one.

Firstly, these two incumbents charge customers an additional platform fee of ₹10/order, which, with GST, totals ₹11.80.

Then, they extract 16-30% take rates of the order value. For example, a ₹500 food order on Swiggy or Zomato may attract ₹80-150 from partner restaurants. Rapido’s delivery fee will stay at ₹59.

The difference narrows on a ₹300 food order, with Zomato- or Swiggy-partnered restaurateurs footing ₹48-90. Rapido will charge ₹29.50 for the same order value.

Strong Last-Mile Delivery Backbone

Rapido boasts a ~40-lakh rider network (captains) that completes 6 crore monthly rides and over 30 lakh daily rides—a major credit goes to the two-wheelers (2W).

The ride-hailing unicorn plans to smartly redirect idle rider time to food delivery without fresh capital expenditure (CapEx). Moreover, the existing logistics infrastructure can speed up rollouts in new pin codes and potentially reduce delivery times in jam-packed urban areas.

As a sweetener, Rapido can expand its restaurant pool by targeting lower AOV eateries in tier 2 and 3 cities. These restaurants haven’t been profitable for Swiggy and Zomato.

Furthermore, Rapido’s previous experience with ONDC in food delivery works in its favor. Riders’ income will likely shoot as order volume increases. A dedicated captain’s app will loop ride, parcel, and food delivery orders into a single platform, with intelligent algorithms assigning jobs to maximize earnings and minimize travel distance.

The Cross-Sell Edge

Thanks to its massive ride-hailing user base, Rapido doesn’t need to splurge cash on bringing in new users to its food delivery app, Ownly. Instead, it can cross-sell to its existing customers by promoting Ownly within its own framework—in-app banners, SMS, and emails. Moreover, people with positive ride experiences will more likely give Ownly a test drive.

This means minimal-to-zero burning of millions on ads, influencer marketing, or discount wars to lure first-timers.

The result? Lower customer acquisition cost (CAC) and higher customer lifetime value (CLV).

But There’s A Flip Side To That Coin

Pricing Edge Wanes For Sub-100 INR Orders

When it comes to the delivery fee, Rapido trumps Zomato and Swiggy for food orders totaling at least ₹100. But for orders under ₹100, let’s say ₹70, Rapido loses its edge to the established players.

Let’s see how.

• Rapido: Combined fee of ₹35.40
• Zomato & Swiggy: ₹11-21 commission

At the lowest order tiers, the incumbents come out as the winners.

Signing Up Lakhs of Restaurants is a Steep Trek

Food delivery is operationally challenging, with only 10% of India’s gross order value (GOV) coming from organized quick-service restaurants (QSR) and the remaining from smaller eateries. So, Rapido Ownly must onboard thousands of mom-and-pop restaurants to scale up.

That’s an operational and logistical nightmare in a fragmented market.

Plus, on the supply side, Zomato and Swiggy have a firmer grip than their challengers. As of Q4 FY25, the Deepinder Goyal-led food delivery platform hosted about 314,000 monthly restaurant partners, followed by Swiggy’s 252,000.

This gives the two giants a clear edge in terms of scale and reach. For a newcomer like Rapido Ownly, inking deals with about 3 lakh restaurants to build supply is an enormous hurdle to jump over.

Shallow Profit Margins

In India, the AOV is ₹350–500, attracting ₹50–70 pre-order delivery costs. Rapido’s proposed take rates would hurt its profitability and, consequently, leave zero scope for further expansion and operational expenses (OpEx).

Rapido is still in the red and burns $4-5 Mn cash every month. So, potential low margins and bleak reinvestments in operations and expansions threaten an increased cash burn as it ventures into online food delivery.

Zomato, for instance, has priced meals 30-35% higher than dine-in rates on average. This makes its total customer costs, including delivery and platform charges, among the highest across continents.

Still, Zomato doesn’t enjoy the gravy train. It earns a flat 4.4% EBITDA, showing how thin profit margins already are, even at scale.

Therefore, Rapido Ownly will feel the pressure to increase take rates from partner restaurants, which can dilute its initial advantage.

Keeping Customers Happy Won’t Be That Easy

Zomato and Swiggy are doubling down on superfast food delivery with platforms, Bolt and Quick, respectively, to bring down delivery time to below 30 minutes. Both the giants are aiming for even faster food delivery.

Rapido’s riders will have to serve two high-priority demand segments—passengers and consumers—if it sticks to using its existing fleet. The mobility company needs to carve out a dedicated rider fleet to soak up the high-pressure, sub-30-minute food delivery. Else, the food might reach customers late due to rider allocation complexities, thus frustrating them.

So, while ₹25-50 per food order sounds great for restaurateurs, will customers switch for (slightly) affordable meals if delivery isn’t that fast?

Furthermore, Swiggy and Zomato have earned loyal customers through discounts, loyalty programs, and their respective quick-commerce services like Instamart and Blinkit. Rapido Ownly’s “earned visibility” model, where restaurant ratings precede paid ads, may not compete against incumbents’ aggressive marketing.

Zomato-Swiggy Won’t Just Sit and Watch

Zomato and Swiggy have already poured $2–3 Bn into building robust food delivery infrastructure. They now boast deep restaurant networks, strong and loyal customer bases, and a brand image that won’t fade anytime soon.

Sure, Rapido may onboard previously untapped restaurants, especially low AOV eateries in tier 2 and 3 cities, onto its platform. This will expand the overall food delivery market rather than poach the customer base of the incumbents.   

Needless to say, Zomato and Swiggy will likely double down on what they do best: faster deliveries, hyperlocal dominance, and deeper discounts.

Is Rapido Biting More Than It Can Chew?

Rapido has entered the food delivery fight club at a time when restaurant owners are fed up with the unsustainable cost structure of Zomato and Swiggy. Ownly’s arrival has spiced up the competition and may compel market heavyweights to rethink their pricing models.

That said, real disruption will require more than low commissions and fleet reallocation.

Until then, Zomato and Swiggy’s structural advantages—dense restaurant networks, loyal customer bases, and operational muscle—remain intact.

It’s a hyper-competitive platform economy and India’s food delivery industry has been unforgiving.

Will Rapido trigger material shifts in the market share or is it just an exaggeration?

Only time will tell.