Inside the Facebook – Jio deal: Changing the paradigm of Indian domestic market
Facebook CEO Mark Zuckerberg has bought a 9.99% stake in Mukesh Ambani’s Reliance Jio, the trendsetting telecom giant of India. This specific business investment has taken everyone by surprise amidst the coronavirus lockdown in most parts of the world. After all, this landmark deal has yet again made Mukesh Ambani, the richest man in Asia.
At a time when the grocery space of the ‘desi’ domestic market is witnessing regular activities, the Facebook-Jio merges hint a bigger game plan for JioMart, the e-commerce face of Mukesh Ambani’s Reliance Jio. The existing e-commerce giants like Amazon, Flipkart and others have ample reasons to be worried about. This is a wake-up call for them, disrupting the whole marketing network. Facebook CEO Mark Zuckerberg is eyeing the domestic Indian market to be a lucrative space, especially after the coronavirus phase. In the rural areas, where digital penetration is yet to reach the peak, the common platform of Facebook-Reliance Jio can be a gamechanger.
In the technological front, let’s not forget that the Facebook investment of Rs 43,574 crore is the largest foreign direct investment (FDI) in India. A week back when the government of India announced restrictions on investments from China, many startups were disheartened, to say the least. After all, 18 of 30 unicorns in India are funded by the Chinese. This itself is an encouragement for the Indian startups and possible investments from US and European giants in the days to come. With a stronger and wiser Reliance Jio, rolling out 5G may be a near possibility in the telecom sector as well. Vodafone, Airtel and other telecom players have every reason to worry about.
Data privacy is one area which will be facing much speculation in this strategic investment of Facebook. After all, both Facebook and Reliance Jio share a bulk of the data belonging to the netizens of this country. In the coming days, the modus operandi will be interesting in this regard. Overall it can be said, sectors like e-commerce, payments, games, education in India are going to witness widespread changes with this huge deal.
Is the merger indicating a platform more powerful than the government itself? The future of Digital India has the answer to this question.