
What is Jio, and why are tech’s biggest players suddenly obsessed with it? - simonebrunozzi
https://onezero.medium.com/what-is-jio-and-why-are-techs-biggest-players-suddenly-obsessed-with-it-231ea2d407e4
======
snowwrestler
> Within a span of four years, Reliance pumped in over $33 billion from its
> other businesses to expand Jio’s market.

> Jio was able to achieve these cheap rates by acquiring the only firm that
> won a pan-India 4G license, leveraging the superiority and cost-efficiency
> of 4G compared to older cellular standards, _and because of the unparalleled
> size and resources of its parent company._ [emphasis mine]

> A sizable portion of the investments will go toward paying off the existing
> debts accumulated by Reliance to fund this extravagant project and its other
> businesses,

Reading between the lines in this article, it sounds like Reliance is simply
buying market share by running Jio at a big loss, and temporarily making up
the difference with huge investment rounds. I feel like we've seen this show a
lot lately and it doesn't always work out.

~~~
paulftw
Yes, but don't forget that "Ambani family have close ties to the ruling
government" and also Jio is "the only firm that won a pan-India 4G license,
leveraging the superiority and cost-efficiency of 4G".

I'm super curious what technical reasons mandate that there can be only one 4G
license in a country with 1.4 billion people. And how that affects competition
in a country that has Corruption Perception Index equal to that of Morocco,
Ghana, China or Benin.

edit: formatting

~~~
quantummkv
You seem to be insinuating that Jio is the only telecom that was given special
all-India spectrum. And that is false. All the spectrum was offloaded in
public auctions were everyone participated and bought spectrum.

Jio is not the only telecom in India with 4g spectrum or services. I
personally use Airtel, and I get 4g everywhere I go without issues.

>I'm super curious what technical reasons mandate that there can be only one
4G license in a country with 1.4 billion people.

The confusion you have seems to stem from the fact that Jio advertises itself
as India's only full 4g network. What that means is that the greenfield
network build by Jio only uses and supports 4g networks and not the older 2g
and 3g networks. So in other words, the Jio network is 4g exclusive for it's
customers.

The older telecom are older and still operate old 2g and 3g networks so they
cannot market themselves that way

~~~
paulftw
I simply quoted the original article

------
ggm
Because the largest market for growth these entities have outside of China, is
India. The middle classes want the goodies, and these players want the income.

Jio has the market.

~~~
iamshs
And more importantly choke-hold over the government bureaucracy. They can
essentially bulldoze government over any rules and regulations, and bribe
around freely. This is how Reliance got big.

~~~
ramshanker
That may have been in the past. However ever since Modi Government came to
power, industrials access to government has reduced drastically. Initial days
of Modi, there used to be some fish trap to warn the officials.

~~~
lvbu
No way you can say that with straight face. The regulatory capture of TRAI by
JIO is very well known.

~~~
quantummkv
Any proofs, incidents, facts, figures to support your accusations?

> The regulatory capture of TRAI by JIO is very well known

It is very well known in the same vein as "Bush did 9/11", "George Soros is
the boss of Illumnati", "Zuckerberg is a lizard human", "Freemasons rule the
world", "Area 51 has aliens", etc. Essentially baseless urban myths.

~~~
shripadk
> Any proofs, incidents, facts, figures to support your accusations?

They have none. Just arm-chair conspiracy theorists.

------
rakamotog
When JIO was launched, till it became the behemoth it is today, there were a
series of some 20 regulatory changes in Telecom in India, all benefiting Jio
at the right time, hurting their competition. When everyone is investing in
Jio, I think its that absurdity everyone is investing in.

~~~
L_Rahman
Which is why I find it better to get business analysis from people who've made
it their job and not overly excited tech journalists:

[https://diff.substack.com/p/to-understand-jio-you-need-to-
un...](https://diff.substack.com/p/to-understand-jio-you-need-to-understand)

------
dang
If curious see also

a few days ago:
[https://news.ycombinator.com/item?id=24008244](https://news.ycombinator.com/item?id=24008244)

a couple weeks ago:
[https://news.ycombinator.com/item?id=23908057](https://news.ycombinator.com/item?id=23908057)

a few months ago:
[https://news.ycombinator.com/item?id=22941489](https://news.ycombinator.com/item?id=22941489)

------
leggomuhgreggo
>Historically, the oil refinery and petrochemical businesses were the most
profitable wings of the Reliance conglomerate, but now that “data is the new
oil,” Jio is the company’s crown jewel.

Oh dear...

------
wtmt
I can’t understand why tech’s biggest players are obsessed with it. I mean, I
know what they may be thinking and why they’re salivating. But I believe
they’re just behaving as if they don’t want to be left behind and seen as
losers, whereas the truth (IMO, and take this with a big pinch of salt) is
that this looks like the seemingly limitless amount of money pumped in by Uber
or SoftBank in the hopes of “capturing the market and making boatloads of
money”, only to realize later that the underlying proposition and the model
were defective, which they will never admit.

Reliance has a lot of political backing (and Jio is what it is today because
of concessions), but again strictly IMO, I think all these tech companies
“investing” in Jio will be left holding the bag in a few years.

~~~
iKevinShah
I am no expert in any sense but the comparison to 'limitless amount of money
pumped in by Uber or SoftBank in the hopes of “capturing the market and making
boatloads of money”' here is incorrect.

JIO already has a good amount of paying, repeating customers and they have the
infrastructure setup and working already for 1B+ people (not subscribers).

So yeah, the tech companies _might_ lose it but not like Uber / Wework did
(IMO). Also, another important point to note is that Reliance, regardlesss of
the political party, will have the backing.

~~~
nine_k
Uber also had a huge number of paying customers! The problem is that they
could not be paying enough to make ends meet.

If Jio is profitable, or would be profitable if it did not invest all the
profits (like Amazon used to do), it's another story. But if the _unit
economy_ isn't working, then yes, it'b be an Uber, a unicorn which is too
heavy for its own hooves.

~~~
9nGQluzmnq3M
Jio _is_ profitable. On paper, their net profit in Q2 was ~$500MM USD.

[https://www.business-
standard.com/article/companies/reliance...](https://www.business-
standard.com/article/companies/reliance-jio-pre-tax-profit-zooms-147-in-june-
quarter-revenue-up-33-7-120073100040_1.html)

They're also heavily indebted and that profit is propped up by some rather
questionable accounting shenanigans, so take that number with a pinch of garam
masala. Still, the unit economics in mobile telecoms are very different from
an Uber: setting up a network from scratch is extremely expensive, but the net
cost of adding an additional subscriber is nearly zero and the revenue from
each additional user goes pretty much directly to the bottom line. (Again
compare Uber, where they probably lose money on many rides due to driver
subsidies, predatory pricing, algorithms not accounting for traffic etc.)

------
iamshs
I wonder how the work culture inside Jio is. Reliance (Petro-refinery side) is
one of the "core companies" for Chemical Engineers but after a summer
internship, students didn't seem interested in pursuing employment there
unless there was no option left. These companies used to be derogatorily
referred to as 'Lala companies' based on the heredity CEOship. (Lalas
typically are merchant class of India, who pass on their SMBs to their sons)

~~~
harpratap
From the stories I hear from my friends - it's a spectrum. Depends on the
department and role you are working in. More technical roles are less Lala but
non-technical roles can out-Lala other Lala companies.

------
dannyobrien
Is Jio still using and building on KaiOS, their fork of FirefoxOS, the
javascript-based mobile OS? I'd love to read the story behind that and where
it's going next. Are their contributions open source?

~~~
quantummkv
They are going to shift to Android for their 5g budget phones with Google
doing some specific android work for them.

~~~
zozbot234
> with Google doing some specific android work for them.

Probably something involving VoLTE.

------
mbesto
TL;DR (not necessarily from the article, but from various sources):

\- Jio is basically a monopoly

\- It prints an absurd amount of money

\- It's only "tech" because it can essentially control the smartphone market
in India (INSANELY HUGE GROWTH)

\- Ambani is the most powerful man in India, but also was over-leveraged on
his oil business and needs capital for growth. He wants more global
control/influence and US tech companies want more control over India. It's a
win-win for both.

\- $100B in 5 years is probably a lowball figure

In other words, imagine Google, AT&T, and WeChat all controlled by one company
in one of the largest potential GDPs in the world.

~~~
ars1141
True, Jio is a Monopoly and getting very powerful in India through its cash
power. This is very dangerous for small companies and startups as Jio have a
wider reach of people and small companies cannot establish in a market already
occupied by Jio. Hence they are easily defeated.

------
partingshots
Does the fact that Google and Microsoft have Indian CEOs, Sundar / Satya
respectively, give them an advantage when dealing with the Indian market?
Especially when considering the fact this pronounced interest in Jio is
largely just as a way to enter into negotiations with the owners of the Indian
market/government.

~~~
switch11
At a superficial level - yes

Both grew up in India before migrating to US so understand India very well

In reality

Sundar Pichai - no

Satya Nadella - yes. This guy is a @#$#$ genius. And Indians have a lot of
respect for smart people who deliver results

 __ __ __ __ __ __ __ __ __ __ __ __

So, Indian Goverment is not owned by Reliance

However, all things being equal Indian Government would prefer an Indian
company like Reliance owns the keys to the kingdom, rather than some
imperialist cunt like Bezos or Zuckerberg

So now these imperialist companies have no choice but to team up with Reliance

Bezos' plans in India are screwed, though, by the way

WalMart/Flipkart was good competition and still #1

However, JioMart is basically as vicious and happy to do illegal things as
Bezos and he has all the connections in India

So India can be written off completely for Amazon retail

Bezos' only choice now is to partner with Ambani as a small stakeholder

~~~
bobobob420
What’s the point of censoring a curse word. Genuinely curious ?

~~~
saghm
It's only strange to me given that what I consider an even stronger swear is
used two paragraphs down from that. I'm not sure if that's due to cultural
differences though (I'm American, but I don't know where GP is from).

~~~
bobobob420
I was just curious and asked a genuine question but instead got the HackerNews
downvote. Maybe it is because of my username people think I am trolling?

~~~
saghm
FWIW, I didn't downvote you; I share your curiosity here, just with some
additional context I wanted to provide

------
vaibhawc
Except for data is not new oil. It is the new myth, way more powerful myth
than that of money.

------
gwbas1c
> What is Jio, and why are tech’s biggest players suddenly obsessed with it?

"What is Jio" isn't mentioned until the middle of the article.

Short answer, it's currently the most popular wireless provider in India; and
it provides much more services.

------
iamgopal
Jio going to build their own 5G equipment for installing in India and
expansion to other country. Their vision is, Data is the new Oil. They are
coming for USofA too.

------
pX0r
All this money and attention will surely pump up the R stock/s like crazy. Not
sure if these investors are also receiving any preferntial liquidation
preference too. Is it not likely that they might dump stock to book huge
profit and the retail Indian investors will be left holding the bag ?

------
bobbydreamer
In the last two weeks, there were multiple articles on Jio and whenever I
comment something, Google analytics says I have new visitor to my website this
hackernews.

I don't know how, this medium article I was able to read and other useful
articles asks me join their membership.

End of day, 1\. BSNL has higher reach in rural areas after then it was idea.
Airtel & Jio are city based mostly that's where the speed is.

2\. JioMart is a provision store, DMart is a provision store. If JioMart buys
DMart then you can say ok he is here to stay. But buy FutureRetail which
already sells only few specific brands not all. So what's the point.

3\. Jio University, It's graded eminence but yet to be built. No comments.

May be ban of tiktok could be due to investment. Everybody in the country had
Tiktok installed and happily watching all the 15-30sec videos, nobody was
using fb. After the ban, in youtube now they are promoting some 15sec, it's
not so interesting as tiktok. JioMeet was a ripoff of zoom. Just before a
month, JioMeet was introduced GoI said zoom can be compromised, it's not
banned because large corporations are already using it.

Ok. Now I am expecting some traffic to my site.

------
known
Trade/Commerce is 100% "reserved" to BANIA since 700 BC in India
[https://en.wikipedia.org/wiki/Varna_in_Hinduism](https://en.wikipedia.org/wiki/Varna_in_Hinduism)

------
known
They're buying an Equity in an Organized mafia in India
[https://news.ycombinator.com/edit?id=24069401](https://news.ycombinator.com/edit?id=24069401)

------
blackswan101
Why are these companies not investing in Africa in players like Jumia I
wonder?

~~~
rudiv
Jumla

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hvaoc
Jio’s parent company reliance is a textbook crony capitalism model.

Since it’s inception they have been able to get unfair advantage by having or
buying insiders from the government also they hire ex-bureaucrats for their
network and no the moves in the government before it becomes public.

On top of it Indian government was holding back retail market access from
international competition till they get to ramp up (which they have done for
donkey years).

So if you need access to Indian market, you have cost up with Reliance and
that’s why you see big players lining up.

If you manage to find it watch On YouTube their annual conference of a sort
(similar to US Tech Companies), you will see all of this on display.

Essentially they are the Indian Government.

~~~
kumarvvr
No different from lobbying efforts in the US.

Case Point : TurboTax

~~~
rudiv
If you really think Jio's reach into the government is comparable to TurboTax
you may not be appreciating that TurboTax is not owned by the largest
industrial group in America & the richest person in America. Try TurboTax
being owned by an amalgamation of Amazon and General Electric that is owned by
Jeff Bezos.

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hendi_
(flagged, because not readable without registration)

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rudiv
Love seeing the desis come out on Hacker News. It's good to see that my
internal stereotype of desi techies remains accurate. Anyway, "ram ram".

