- We are looking at the journey of Reliance Jio and how it is much more than a data provider and how it is powering digital transformation in India.
We are looking at the journey of Reliance Jio and how it is much more than a data provider and how it is powering digital transformation in India.
Reliance Jio has recently been among the most talked-about digital firms. Although India’s economy is facing its worst slowdown in 30 years, and industries are reeling under the coronavirus crisis, Jio has attracted a slew of global investors to cut billions of dollars in cheques.
To understand Jio’s ambitions, one has to trace back to the beginnings of his telecom, and know that it was never about data or mobile phone alone. But that is where it all started. When Jio unveiled a deluge of ‘free and unrestricted’ deals in September 2016, telecom firms sat up and got alert. While many hailed the dream of Mukesh Ambani for a truly Digital India, some were even jeering at him.
In July 2017, Reliance unveiled the first paid plan for Jio at its 40th AGM in Mumbai, where the company is headquartered, after more than three quarters of providing free 4 G data. Until then, Jio had reached 108 million users, 72 million of whom were paying subscribers, drawing on the annual membership of Jio Prime for Rs 99. This also had become the fastest-growing telecommunication network in the world.
Yet amid its growing popularity, Ambani realized he needed to soften the blow when he was going to ask free users to start charging for Jio. He announced that Jio will deliver the cheapest mobile data in the world, with just Rs 11 costing 1 GB, less than a vada pav-famous street food in Mumbai. The comparison hit in at home.
Reliance slowly raised tariffs for Jio between 2017 and 2020 but India continues to have the world’s cheapest mobile data. At present, the average cost of 1GB of data is Rs 18 ($0.26). And, Jio is the largest telco in the country, with 388 million subscribers.
RIL ‘s goals for Jio have always been broader and deeper than that which meets the eye. “They were always looking to take Jio beyond connectivity. It was an opportunity for data, technology, and ecosystems. Connectivity was nothing but the lubricant.
Notable acquisitions of the conglomerate in the technology room include Saavn (music streaming), Haptik (conversational AI), Embibe (learning and edtech), Reverie (Indi language software), NowFloats (SaaS for SMEs), Den Networks and Hathway (cable and broadband), Radisys (5G and IoT), and more.
According to Morgan Stanley Research, RIL spent $3 trillion in vertical acquisitions in three years. “The acquisitions reflect their desire to invade market space by using technology,” it says.
Sometime in 2019, Ambani made it clear that Jio’s ambitions weren’t restricted to just telecom. It will be artificial intelligence ( AI), the internet of things ( IoT), blockchain, online gaming, video sharing, multi-party video conferencing, augmented reality (AR), virtual reality ( VR) and mixed reality (MR), e-commerce, shopping, safety, etc.
JioMart will act as a common marketplace for both big and small customers, retailers, and vendors while at the same time allowing Jio even greater bargaining power and leverage with FMCG companies. On a broader basis, it will also have the potential to play a greater role in bringing great effectiveness to food production, demand, and consumption in India.
What Global Investors Have To Say?
General Atlantic chief executive Bill Ford said: “As long-term supporters of global technology leaders and visionary entrepreneurs, we couldn’t be more excited about investing in Jio. We share Mukesh ‘s conviction that digital connectivity has the potential to accelerate the Indian economy significantly and drive nationwide growth. General Atlantic has a long history of working alongside founders to scale up disruptive businesses, as Jio does at the forefront of India’s digital revolution.
Egon Durban, co-CEO and managing partner of Silver Lake, described Jio Platforms as one of the most outstanding companies in the world, led by an extremely powerful and ambitious management team that drives and actualizes a courageous dream. “We have brought exceptional technical skills to bear on bringing the potential of low-cost digital technology to a mass customer and small business population,” he said.
Henry Kravis, KKR’s co-founder, and Co-CEO said, “Few companies can change the digital economy of a country in the way that Jio Networks is doing in India, and potentially around the world. Jio Platforms is India’s first indigenous next-generation technology pioneer, unrivaled in its ability to bring technology innovations and services to a world undergoing a digital revolution.
Facebook also invested in Jio. Around the same time as the investment, Jio Platforms, Reliance Retail Limited, and WhatsApp have signed a strategic collaboration agreement to further accelerate the New Commerce sector of Reliance Retail on the JioMart platform using WhatsApp and to help small businesses on WhatsApp.
The above statements certainly establish the fact that Jio has a reputation and it is turning out to be the next big thing in the Indian ecosystem.
The sovereign wealth fund of Microsoft and Saudi Arabia could be looking to invest in Jio Platforms. By the way, in 2019 Jio had signed a 10-year strategic deal with Microsoft to build data centers to push the digital transformation of India.
With more investors and more speculation, it will be interesting to see how Jio evolves. Jio has survived and thrived and the upcoming future seems brighter.