Asia’s richest industrialist confident his behemoth company will dominate tech and telecom
(AF) A year back, two of Silicon Valley’s tech giants Google and Facebook pumped billions into Mukesh Ambani’s Reliance Industries (RIL), to bet on his Digital India dreams and grab a seat in the world’s fastest-growing internet market
It appears this year, the more-than $10-billion that the two giants collectively invested in Jio Platforms (Jio), the Indian technology company and a subsidiary of RIL, will start bearing fruit.
Among some major announcements at RIL’s 44th annual shareholders meeting on Thursday, chairman Mukesh Ambani said that Jio will launch a fully featured smartphone developed in partnership with Google, called JioPhone Next (Next), “which will be one of the most affordable smartphones globally, with cutting-edge technology.”
Slated to hit the country’s retail shelves on September 10, the 4G Next will enable the 300 million Indians who still depend on archaic 2G connectivity to move to the information superhighway. Later, Next will be sold globally, Ambani said.
In another announcement that benefits Facebook directly, Ambani said that Reliance Retail (RRL), another subsidiary of RIL that Ambani claims to have emerged as the country’s largest retailer with 12,700 stores, plans to embed its e-commerce app JioMart into WhatsApp within six months.
That, he said, will allow 400 million users of India’s most popular messaging service to order products without having to leave the app.
In April last year, Facebook bought a 9.99% stake in Jio by investing $5.7 billion to underscore its commitment to India, and to participate in India’s “dramatic transformation, and to create new ways for people and businesses to operate more effectively in the growing digital economy”.
The investment was also key for the social media giant getting access to Jio’s now 400-million user base as well as the political backing of Ambani.
In July that year Google also chased Ambani’s dreams by investing $4.5 billion for a 7.73%-stake in Jio – a rare move for the search giant – to join its global rival Facebook in backing a venture.
That aside, Jio had also raised about $10 billion from 11 other Silicon Valley investors including Intel, Qualcomm and KKR by selling about 15% stake.
The Jio Mart-WhatsApp integration will allow JioMart catapult its reach across India, Ambani said on Thursday, enabling RIL to challenge Flipkart and Amazon’s domination in India’s fast-growing online retail market, estimated to reach $1.3 trillion by 2025.
JioMart was launched in May across 200 Indian cities, a month after RIL signed a pact with WhatsApp to boost the reach of the online shopping website.
RRL is also on the verge of on-boarding local mom-and-pop stores, Ambani said. They would be linked to RIL’s logistics arm Grab, which it acquired in 2019 for $14 million.
“A new 5G partnership between Google Cloud and Jio will [also] help more than a billion Indians connect to a faster internet, support businesses in digital transformation and lay the foundation for the next phase of India’s digitisation,” Google-parent Alphabet’s CEO Sundar Pichai said at the meeting.
Jio, which claims to have developed a fully indigenous 5G technology, has tested the 5G solutions in India and demonstrated speeds of up to 1GBPS, said Ambani adding “Jio is not just working to make India 2G-mukt (free), but also 5G-yukt (enabled)”
Ambani said he is confident of being the first to launch a full-fledged 5G service in India. Reliance is creating 100% owned intellectual property in 5G, AI/ML, blockchain, and mixed reality.
Google Cloud will help Jio in the 5G roll-out by providing an end-to-end solution for fully automating and managing Jio’s network and services, which will run on its Cloud, CEO Thomas Kurian said.
NEW ENERGY; ANOTHER JIO?
In yet another significant announcement, Ambani said RIL aims to bridge the green energy divide in India and globally by investing more than $10 billion in the next three years in developing value chains, partnerships and future technologies, including upstream and downstream industries in green energy.
As one of the biggest power markets in the world, India is slated to play a leading role in transforming the global energy landscape. To kick-start green energy use in the country, RIL has established the Reliance New Energy Council, which will develop the Dhirubhai Ambani Green Energy Giga Complex, in Jamnagar, Ambani said.
The complex will be among the largest such integrated renewable energy manufacturing facilities in the world and will manufacture and integrate all critical components of new energy ecosystems like solar photovoltaic modules, energy storage batteries, electrolysers and fuel cells, he added.
Ambani, who has segregated RIL into separate verticals of digital businesses (Jio), retail (RRL), and O2C – carved out of the oil refining and petrochemical division – to attract strategic partnerships, also made a long-awaited announcement of roping in the world’s largest oil company, Saudi Aramco, to partner RIL’s future energy plans.
Ambani announced the induction of Aramco chairman Yasir Al-Rumayyan onto RIL’s board as an independent director. He’s also governor of the Public Investment Fund (PIF) – the Saudi sovereign wealth fund.
“His joining our board is also the beginning of the internationalisation of Reliance,” Ambani said.
Under Al-Rumayyan, the PIF in June last year bought a 2.32% stake in Jio and a 2.04% stake in RRL. PIF has also invested in Digital Fibre Infrastructure Trust, an infrastructure investment trust that holds RIL’s fibre-optic assets.
According to Ambani, RIL’s business performance has exceeded expectations despite the pandemic. Even in a challenging environment, RIL’s performance continued to be outstanding, he said.
“I believe speedy recovery in the post-Covid period is beyond any doubt. But beyond recovery, there will be rapid resurgence. I have no doubt that India is destined to emerge as one of the top three economies in the world,” he said.
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