Facebook’s influence on the mobile network ecosystem, and on encouraging more open and cost-effective RAN platforms, is certainly not channelled entirely through Telecom Infra Project. The social media giant is developing and deploying its own equipment – from low cost OpenCellular base stations to satellite platforms for backhaul – in some scenarios, not to turn into a network operator but to kickstart partner efforts and build confidence.
And it is also driving its agenda for ubiquitous Internet connectivity through direct alliances with major operators, with the huge Indian market a key focus. In May, Facebook announced an INR 435.7bn ($5.7bn) investment in a 9.9% stake in Jio Platforms, the subsidiary of Reliance Industries (RIL) in which disruptive MNO Reliance Jio sits.
This sparked a queue of companies eager to take stakes in Jio, resulting in the company raising about $15bn across 11 deals and wiping out much of its debt. Investors included private equity firms, but also several strategic partners including Google, Intel Capital and Qualcomm Ventures. Later in the year, there were reports that Amazon wanted to form a joint venture with Reliance’s retail arm to expand its real and virtual stores in India.
Facebook and Google are both looking to do more with their investments than wait for a return – they are engaged in many activities with Jio that could ensure them a leadership role in shaping and expanding India’s mobile and digital transformation – potentially at the expense of local challengers that might emerge, China-style.
Fending off such potential challenges even brings the two Internet giants into cooperation with one another. This month, Reliance Industries is said to be partnering with both Google and Facebook to develop a new payments network in India, which could significantly accelerate uptake of mobile payments and ecommerce under the auspices of the US giants.
This effort is in response to a current plan by the Reserve Bank of India (RBI) to award New Umbrella Entity (NUE) licences to one or two organizations or consortia, to run national digital payments services based on a defined set of interfaces.
According to Indian business newspaper Economic Times, Jio, Facebook, Google and local player So Hum Bharat Digital Payments will create a NUE to run a common payments platform. The reports say plans have already been submitted to the RBI, though the alliance is not finalized yet and the Bank’s review is likely to take about six months. So Hum Bharat’s founder Navin Surya has reportedly been lined up as CEO of the new entity.
The Jio group may find itself in competition with another consortium led by Amazon and local partner ICICI Bank, as well as other applicants.