Reliance Jio partners with Facebook and Google, KKR and Qualcomm joins the league
Technology giant Google is in talks with Jio for an investment of $4 billion. The two companies are in an advanced stage of talks. If Jio confirms the deal in a few weeks — Google is going to be the thirteenth investor in the company. Facebook did invest before google in Jio platforms in April, where it announced that it will be developing a 9.99% stake in the company. Jio Platforms got an investment of Rs 43,574 crore investment earlier this month.
For the first time, technology rivals Google and Facebook are strategic partners in one company — Jio Platforms. Both Facebook and Google have been seeing India as a big market and trying to reach the entire billion people in the country. However, both had seen very little success due to regulatory headwinds and tough market conditions.
It is uncommon for Facebook and Google, giants in their own right, and intense competitors, to come together for a common cause. Even less so when it involves billions of dollars invested individually and the next big thing at stake.
Google confirmed on Wednesday that it’s investing $4.5 billion into Indian digital services firm Jio Platforms. Though, in exchange for a 7.7% stake in the company, which is valued at $65 billion. Mukesh Ambani’s Reliance Industries, Jio Platforms operates the Jio Infocomm telecom network, which has over 388 million 4G subscribers. Today it is India’s top telco, and also has several apps and other services in e-commerce and broadband.
The partnership with Google is at building affordable devices, tapping into the developer ecosystem on Android and software play.
Google, invested $5.7 billion of the $15 billion it committed in the Reliance Industries digital unit, they said, asking not to be named. Jio had no option but look for a strategic and deep-pocketed financial investor like Google, according to one of the persons
The deal between Jio Platforms and Facebook was out on April 22. Jio’s partnership with Facebook is more about:
- Connecting with small businesses
- Building consumer community on social media
- Using WhatsApp reach to connect with small businesses
At RIL’s all-virtual annual general meeting on July 15, CMD Mukesh Ambani took some time highlighting the Facebook deal. “… We have been privileged to enter into another strategic partnership with Facebook. We had announced our partnership in April of this year, and we have now received all the necessary regulatory approvals. Both Facebook and Jio share a strong vision for digitally empowering consumers, small businesses and entrepreneurs across India,”.
Facebook knew that video is the next big thing, promoting it in its Newsfeed, pushing Facebook Watch and its videos over Google-owned YouTube’s links. Virtually overnight, YouTube links videos which went viral on Facebook. Even before that, Google took a shot at the social media pie with its own Google+. It ended as one of tech’s most famous failures from a giant, but not before Facebook feared the Google challenge and CEO Mark Zuckerberg mobilized the company to rise to the challenge. Jio chose to ally with it.
INDIA’S GOLDEN OPPORTUNITY
No other country has these many people discovering the internet at record low data prices. Looking at these roughly 300-400 million new internet users, along with Reliance Jio’s, and its promises in every other sector, make it irresistible for tech giants like Facebook and Google. Irresistible enough to keep aside its differences and become common investors in Jio.
Simply at India’s advantage. At a time when the US market is down, antitrust awareness is higher than ever, and both companies withdrew from China, even as the US and the world rebuke Chinese tactics more than ever, India becomes the next battleground for any global technology player looking for its next big growth market.
CLICK TO READ MORE ARTICLES LIKE THIS