Firm charts plan for a global ecosystem spanning telecom, e-com, retail and enterprise solutions
On the oil and gas business, Mukesh Ambani said he has been approached by global companies for strategic partnerships in its chemical business
Reliance Industries Ltd (RIL) chairman Mukesh Ambani announced the development of a made-in-India 5G technology solution that he envisions will be the cornerstone of the company’s strategy to create a connected digital ecosystem, spanning telecom, e-commerce, retail and enterprise solutions in India and outside.
“Once Jio’s 5G solution is proven at India-scale, Jio Platforms would be well-positioned to be an exporter of 5G solutions to other telecom operators globally, as a complete managed service," Ambani said at the company’s 43rd annual general meeting on Wednesday.
The technology was built indigenously by an in-house team at Jio Platforms, the company’s digital business arm, said Ambani, who recently surpassed Google co-founders Sergey Brin and Larry Page to become the sixth-richest person. Laying out his vision for the firm, Ambani said one of the key focus areas of Jio will be to upgrade millions of Indians using feature phones on 2G networks by offering them cheap smartphones. “As India is standing at the doorsteps of the 5G era, we should accelerate the migration of 350 million Indians, who currently use a 2G feature phone, to an affordable smartphone," Ambani said. “We believe we can design an entry-level 4G…or even 5G smartphone at a fraction of its current cost. But, to power such a value-engineered smartphone, we also need an equally value-engineered smartphone operating system and such an operating system must be designed with India in mind. Google and Jio are partnering to build an Android-based smartphone operating system."
Analysts said a key part of Jio’s strategy is to leverage the tech developed by startups in which Reliance has invested. Jio Platforms has more than 20 startup partners and has been working with them to build indigenous capabilities. As part of the strategy, the company has in the past few years invested aggressively in startups across education, healthcare, diagnostics and software solutions to develop offerings such as video conferencing app JioMeet and augmented reality gadget Jio Glass. Announcing further value unlocking in the retail business, which has since become a major revenue contributor to the group, Ambani said more strategic partnerships will be announced in the retail business. Last year, Reliance Retail reported a revenue of ₹1.63 trillion and operating profit of ₹9,654 crore.
On the oil and gas business, Ambani said he has been approached by global companies for strategic partnerships in its chemical business, including in utilizing the feedstocks.
The covid pandemic has, however, cast a shadow on RIL’s $15 billion stake sale to Saudi Aramco in its oil-to chemicals (O2C) business. Ambani said due to unforeseen circumstances in the energy market, the deal has not progressed as envisaged initially.
However, RIL’s equity requirements have already been met. “Nevertheless, we at Reliance value our over two-decade-long relationship with Saudi Aramco and are committed to a long-term partnership. We will approach NCLT with our proposal to spin off our O2C business into a separate subsidiary to facilitate this partnership opportunity. We expect to complete this process by early 2021," said Ambani.