So Jio and Facebook are combining forces. Two devils have made a deal.
About a month ago I wrote a piece on why Reliance needs Facebook to buy into it. Now that the deal has been announced, we can ponder the implications of this.
The way I see it, Reliance is bringing the pipes, which is the network with users and Facebook is bringing the technology to take advantage of it.
Communication – The lowest hanging fruit is the communication stack for enterprises. COVID-19 has opened the work from home pandora’s box and has also exposed the limitations of existing solutions. Armed with WhatsApp, and the power of the network under its belt, Jio can create solutions aimed at this segment. Jio already has the JioChat and they may see how to improve upon the technology and make it more complete.
Money Transfer – Facebook has been in a long drawn fight with the RBI about the UPI license. Facebook wanted to enable UPI on WhatsApp. There was a great deal of pushback because the implementation was called a walled garden approach. This resulted in their license being cancelled 2 years ago. They recently got an approval for phased rollout. With Reliance on its side, I am sure they will be able to bend the rules a lot more easily now.
Okay, quiz time. Pick the right statement from those below. (Hint: Only one of them is correct.)
Google’s UPI-based payments app Tez allows to only send money to those with a Gmail address or an Android phone
Paytm users can transfer money using UPI only to other Paytm users
Flipkart-owned PhonePe allows payments only to Flipkart users
WhatsApp users can send money only to those who use WhatsApp and have enabled the payments feature within it
Do you have your answer? Now, hold on to it for a bit.
https://the-ken.com/story/facebook-tests-waters-walled-payments-garden-india/
E-Commerce – Reliance has a huge retail footprint. Not to mention it has a pan-India distribution capability. Going after e-commerce is the logical next step for the company. Further, if they could create a super app by integrating this into WhatsApp, it can be a game-changer. They can potentially bring every kirana store online and get into the delivery business without paying for a single bike. This perhaps could be the most disruptive change that they could potentially unleash on Amazon.
Ticketing – With almost all of the ticketing services now on APIs it is just a matter of integrating this with their product to enable the same. All kinds of tickets from movies to airline tickets will be made available through a super app, which could be WhatsApp or something else but they will certainly try to get their hands into this space.
Content – This will be the easiest play to make and now with the pipes in their hands they may make an aggregation play or go for original content. I expect them to acquire AltBalaji or some other streaming content play that can be strapped onto what they already have and add some of their own as well. They could potentially attempt to get a deal with some other Hollywood majors. Reliance owns TV18 and Reliance Entertainment (yes of the little know Ambani) owns Dreamworks. Yup!
In addition to this, they will certainly make a foray into gaming and if they have kept their ears to the ground even e-sports.
Healthcare – Healthcare has gone the telemedicine way thanks to the intervention of COVID-19. Now, this is another space that is wide open for those owning the pipes to take advantage of. Can they quickly get a network of doctors ready? Why not?
Crypto – Facebook had made a huge push for Libra last year. Then it all came apart. Now with this association and with the Supreme Court allowing for Crypto trading in India, there is a possibility, they might look to launch in India. Also, this will give them a smooth entry to try and tap a new market that is quite nascent in India.
Financial Services – Finally, if you have all the financial information about your users at your fingertips you can start selling them other financial services such as insurance and investment solutions.
Data Storage – Not only this Reliance has a 10-year agreement with Microsoft for building cloud infrastructure in India. With the government pushing for Indian user data to reside in India, they might become one of the biggest in the country. While this might seem harmless, it just ensures that all of the data coming through all of these sources might be at the disposal of the company.
So take all the data from all of these services mentioned above, then add Facebook and Instagram to it and tell me what would they not know about you? Also, what might they be able to sell to you?
