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With Jio and Facebook coming together, India is set to witness a revolution in e-commerce

For the first time, rural consumers and businesses would be under the radar

Amit Agrahari by Amit Agrahari
22 April 2020
in Business
Facebook, Jio, Mark Zukenberg, Mukesh Ambani
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Facebook, the American Internet giant which owns WhatsApp and Instagram has purchased minority stake- 9.99 per cent- in Reliance Jio, for 5.7 billion dollars. This is the biggest investment in an Indian telecommunication company by a foreign company. “This investment underscores our commitment to India and our excitement for the dramatic transformation that Jio has spurred in the country,” said Facebook.

The important question, however, is- what Jio brings to the table for Facebook for which it made such a huge investment, that too for a minority stake. In its media briefing, the company said it will work with Jio to create “new ways for people and businesses to operate more effectively in the growing digital economy.” 

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Well, Jio has the largest customer base in rural India, and the user data of rural customers is what brings both companies together. Facebook owns WhatsApp, the messenger app with more than 40 crore customers in India. A few months ago, the company got approved from NCPI to launch the UPI based payments platform.

Jio, which is already present in broadband space, smart devices, cloud and edge computing, Big Data analytics, artificial intelligence, Internet of Things (IoT), is planning to launch a WeChat like super-app which can be used for almost everything possible in the digital economy. “The idea is along the lines of WeChat where users can converse, undertake digital payments, play games and also book flights and hotels,” as per a report by Financial Express.

And for this, Jio will use data from Facebook’s popular messaging apps- Whatsapp and Facebook messenger- and Whatsapp Pay for payments services.

By using WhatsApp as a platform for pushing Jiomart, the company would bring crores of Kirana stores and other small businesses and the buyers together. “In the very near future, JioMart, Jio’s digital new commerce platform, and WhatsApp will empower nearly 3 crore small Indian Kirana shops to digitally transact with every customer in their neighbourhood. This means all of you can order and get faster delivery of day-to-day items, from nearby local shops. At the same time small Kiranas can grow their businesses and create new employment opportunities using digital technologies,” said Mukesh Ambani, Chairman of Reliance Industries Ltd. in a video message.

Both companies coming together would put a huge amount of user data, especially of the rural consumer in their hands. And they plan to harness this data to revolutionize e-commerce and many other businesses in the country, especially in rural parts where penetration is very low and competition is near zero.

“That’s a big deal, because when people get access to the internet and digital tools, they’re empowered to do a whole lot of new things, learning and teaching and finding communities and people they care about. And, of course, starting all kinds of new businesses and this is really important especially right now because small businesses are the core of every country’s economy, and they need our support. India has more than 60 million small businesses, and millions of people rely on them for their jobs and livelihoods,” said Mark Zuckerberg, CEO, Facebook, in an official post.

More than a year ago, in July 2018, when Reliance Jio first time announced intention to enter in e-commerce, we at tfipost.com wrote an article that- “The entry of Reliance through Jio is the extremely worrisome thing for the Amazon because it is one of the most ruthless competitors in the world. Reliance works out for complete domination in whichever sector it enters be it textile, refinery, or telecommunications market.”

The stage is set for a battle between the World’s richest man and Asia’s richest man, the prize is Indian online retail market

It looks like the stage is set for competition between two of the most iconic business tycoons of the world, as we argued a year ago.

Facebook has been trying hard from a long time to establish its strong foothold in the Indian market and the recent investment made by Facebook has been done keeping an eye on the 380 million user base of Jio across various platforms. A large ecosystem is to be witnessed with the coming together of Facebook and Jio.

Tags: facebookJioMark ZuckerbergMukesh Ambani
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