Why Facebook, Google are Investing So Much in Jio

Mukesh Ambani is now 5th Richest Person in the World Overtaking Warren Buffett

If you are from India, Jio is undoubtedly a common name for you. But for those, who don’t know about Jio let me tell you Jio is the company that took the Telecom Industries by storm in 2016 making India second online market in the world with over 560 million Intenet.

But before diving into the details of Jio, let’s have some ideas of who Mukesh Ambani is.

If you are from India, you must have heard from your parents in your childhood,

We are not rich like the Ambanis that we can cover all of your expenses

And it’s true indeed. His $1 billion mansion Antilia in Mumbai is the most expensive property according to Forbes.

In fact, Mukesh Ambani’s net worth is far ahead of his other competitor billionaires in India.

Here is a list of all Indian billionaires from Wikipedia(The list is old a bit).

With a net worth of 77.4 billion USD(2020), Mukesh Ambani is also the only Asian person to feature in the top 10, placed just after Mark Zuckerberg who has a net worth of $88.3 billion and stands at number 4. Recently Mukesh Ambani overtook Warren Buffet whose net worth is 73.4 Billion USD.

Introduction

It all started in 1957 in Aden, Yemen where he was born to Dhirubhai Ambani and Kokilaben Ambani. He has a younger brother Anil Ambani and two sisters. Ambani briefly lived in Yemen because his father Dhirubhai Ambani left Yemen and came to India to start a trading business that focused on spices and textiles. Until the 1970s, his family lived in a modest two-bedroom apartment in Mumbai. The family’s financial status slightly improved when they moved to India but Ambani still lived in a communal society, used public transportation, and never received an allowance.

Career

Ambani in his youth enrolled for an MBA at Stanford University but withdrew in 1980 to help his father build Reliance, which at the time was still a small but fast-growing enterprise. His father Dhirubhai felt that real-life skills are harnessed through experiences and not by sitting in a classroom. So he came back to India and took command of his father’s business.

Gradually, Ambanis expanded to Refining and PetroChemical Industries, Retail business, and became successful in each field. After his father’s death in 2002, Anil and Mukesh got into a conflict over the large empire of the Reliance. At this point, their mother came to solve the conflict between them. Reliance Telecommunication business went to elder brother Anil Ambani and Reliance PetroChemical business went to Mukesh.

JIO

Undoubtedly, Jio is Mukesh Ambani’s biggest success so far. Before Jio, India was one of the least internet using countries in the world. The price of data was so high that people couldn’t afford to buy higher data packs. At this point, Mukesh tried to change internet usage in India. He took a loan of a hefty amount to install the 4G connection in India. Reliance Industries now has invested nearly $40 billion since 2010.

JIO Deals in 2020

But the year 2020 seems to be the golden year for Jio. While the whole world is under pandemic, Mukesh finds new investors every week. Here is a list of all investors of Jio.

Besides the above companies, Google is investing $4.5 billion.

Why Jio is Raising So Much Funding

Digital Economy:

After the Digital India Program in 2015 by P.M. Narendra Modi, Jio focused on data and within 4 years it acquired almost 388 million customers and became India’s largest telecom operator. Jio had so much money that it gave free internets for 6 months to kill its competitors.

But telecom operation was the first step towards his digital economy dream. For the last 2–3 years, Jio has been acquiring companies or investing in startups from completely different fields like Augmented Reality, Artificial Intelligence, Machine Learning, Internet Of Things, etc. His goal was to integrate all these companies under Jio. That’s why he built multiple applications like JioChat, JioNews, JioSaavn, JioCinema, JioMoney, etc, and then took investments from foreign companies to get all the money to integrate these apps.

Guidance in Tech:

If you look into today’s giant corporations, there is a common pattern among them - all of the corporations work in technology. Because any company working in technology can scale up to a new level, technology companies are so prosperous. Mukesh Ambani is smart enough to understand this fact. And that’s why he is so eager to step into technology.

Debt Free:

At the beginning of launching Jio, Mukesh had a debt of $21 billion. Now because of COVID-19, Reliance’s petrochemical industry was unable to raise funds from Saudi Aramco. This is where he used Jio to raise funds. His aim is to gain the trust of shareholders in order to take more risks.

Invest in 5G Tech:

Mukesh’s next goal is to bring 5G Technologies in India. Earlier, he tied up with Samsung to bring 4G technology in India. Telecom Regulatory Authority of India(TRAI) made it mandatory to make all the equipment in the country so that data remains in the country. As soon as Jio launches 5G technologies, it will be the first one to have the most competitive advantages.

Why Foreign Companies are Investing

Google:

Google and Jio plan to develop an entry-level Android phone that can bring millions of Indians online. With a population of 1.3 billion people, India has the potential to have the most online users. With over 560 million internet users, India is the second-largest online market in the world, only behind China. But still, a large proportion of the total population does not use the internet. Google wants to fill that gap and make tons of profit.

Facebook:

In spite of acquiring multiple startups, Jio was unable to increase the usage of the applications and services. That’s why Reliance tied up with WhatsApp. WhatsApp has already 400 million users in India. So, Mukesh has already launched JioMart(Grocery App) with WhatsApp. Customers can now directly place orders in JioMart via WhatsApp.

Qualcomm:

Qualcomm is a world leader in wireless technology. It has specialized in 3G and 4G but brings an unbeatable 2 years of experience in designing 5G products and solutions. It is also a pioneer in solutions like IoT, machine learning, artificial reality, virtual reality, etc. As Jio gets ready to launch an affordable 4G and possible 5G smartphone and operating system and develop its own ‘Made in India’ 5G products, Qualcomm will give it an edge.

Here is a video clip of launch of Jio Glass Program

Conclusion

Data is the new oil

A few years ago, in an interview, Mukesh Ambani said this, and he has already proved this. Now it’s time to see how far Jio can go in order to change India. And that’s why

India’s digital mother tongue will be Jio’s IP