Mukesh Ambani led Reliance Industries limited is planning to revolutionize another sector and this time bet is on cloud market. The company will build data centers across the country in collaboration with Microsoft’s Azure cloud. The data storage race is the new attraction for businessmen in India and the data market is expected to grow to 5.6 billion dollars in next five years.
In less than three years, Mukesh Ambani run Reliance Jio revolutionized the telecommunication sector of the country. Today internet data prices in India are among lowest in India, speed of mobile internet has improved substantially and many small players were forced to exit from the market. The telecommunication market has consolidated, matured and efficiency has improved since the entry of Jio.
Indian billionaire Gautam Adani also has plans to build data parks in Southern states in India with an investment worth 700 billion rupees ($10.2 billion) in next two decades. The global IT firms bet big on rising Indian demands for smart phones and internet data, and given the firm stance of the government on data localisation, these giant firms will need storage facilities in India if the government moves forward with the Personal Data Protection Bill. Indian business tycoons, Gautam Adani and now Mukesh Ambani, intend to capitalise on this opportunity.
Indian government has made it very clear to Information Technology multinationals that information shared by Indian users must be stored locally. The Modi government stood firm on its stance despite opposition from American technology majors and Trump led US government. The Indian industrialists including Ambani firmly stood behind the Modi government and backed its decision to localize the storage of data.
“In this new world, data is the new oil. And data is the new wealth. India’s data must be controlled and owned by Indian people and not by corporates, especially global corporations,” said Mukesh Ambani in vibrant Gujarat summit.
Reliance Industries has established 10 year alliance with Microsoft’s Azure cloud to take on Amazon and Google, the existing major players in data storage. “We now have the capability to develop truly India-native solutions, including speech recognition and natural language understanding for all major Indian languages and dialects,” said Amabni during Annual General Meeting of the company.
The entry of Reliance will start price war in data storage market. Aggressive pricing to weed out smaller players and grab large slice of the market is typical to Reliance’s strategy for any market. So far Indian market has been dominated by Amazon Web Services (AWS) and Google and these companies charged high prices due to lack of competition in the market. But with the entry of Reliance, the rules of the game will no longer be the same. “Other cloud players like AWS and Google will have to come up with new, perhaps cheaper pricing models for India,” said Satyajit Sinha, an analyst at tech consultancy Counterpoint.
The Indian born CEO of Microsoft- Satya Nadella addressed the shareholders of Reliance through and recorded video message. Nadella also used Twitter to announce company’s partnership with Reliance. “Our partnership with Jio will bring the power of Azure, Azure AI and Office 365 to millions of businesses in India – helping them innovate and grow,” tweeted Nadella.
Our partnership with Jio will bring the power of Azure, Azure AI and Office 365 to millions of businesses in India – helping them innovate and grow. https://t.co/9EYYwPZvX2
— Satya Nadella (@satyanadella) August 12, 2019
The IT companies have already started reconsidering the plan to continue with existing players. “We definitely will reassess whether we should keep using AWS or something else, because storage is a huge cost,” said Aprameya Radhakrishna, the founder and CEO of Vokal. “India is a price conscious nation in general and anything which is competing on price will definitely get attention,” he added.
The government has drafted 2018 Personal Data Protection Bill for mandatory data storage in the country. The government is of the view that privacy of individuals must be maintained and their personal data must be stored locally. The Modi government has to face the ire of global corporations and foreign governments including that of Trump administration. However, in a stern commitment to national interest, Modi government has been very firm on India’s data sovereignty and policymakers including former CEA Arvind Subramanian and industrialists like Mukesh Ambani, Gautam Adani and others have supported the stand of the Modi government.
Data localisation will be beneficial for the protection of privacy of individuals and maintaining India’s data sovereignty. Given the fact that data is being considered as the new oil, India’s capacity building in storage is necessary and in national interest. Industrialists like Mukesh Ambani hold to key to ensure that the Googles and Amazons of America have sleepless nights as India gears up to own and protect its data.