Reliance annual meeting: Ambani to provide an update on Facebook and Google partnerships
Reliance, whose major businesses include energy and retail in addition to technology, is expected to provide an update on those initiatives at its annual shareholder meeting on Thursday, along with an ambitious plan to build out India’s 5G network.
“Supply constraints are impacting almost everyone in the industry, but the impact on smaller, local players is even more, as they are not really the top priority for the component makers,” said Kiranjeet Kaur, an analyst at research firm IDC. While Jio does have enormous resources at its disposal, it is still relatively new to the smartphone game, “and the focus on the low end makes it even more difficult” to procure parts, she added.
A Jio spokesperson declined to comment on its plans for the smartphone’s release and sales, but acknowledged that the pandemic could have an impact on the timeline for its rollout. Google did not respond to requests for comment.
India’s prolonged Covid outbreak and the resulting economic crash has also hurt consumers’ ability to upgrade their devices, according to Tarun Pathak, research director for mobile devices at Counterpoint Research. That makes the country’s smartphone market even more price-sensitive at a time when manufacturing them is getting more expensive.
“That is where we see challenges for someone like Jio. … Every cent matters,” he said.
An uphill battle to build an e-commerce empire
Facebook’s $5.7 billion investment in Jio — one of the US company’s largest ever — is a marriage of convenience between two services that form the backbone of India’s internet. Jio and Facebook-owned WhatsApp each have more than 400 million users in India, and the partnership between them is part of an effort to unseat Amazon and Walmart at the top of India’s online retail market.
JioMart, Reliance’s e-commerce platform, aims to do that by bringing millions of India’s mom-and-pop stores online. Launched months before Facebook’s big investment, JioMart now operates across more than 200 Indian cities.
“Getting independent merchants on board has been a challenge since many of [them] are wary of sharing their business information, and many are still not clear about the value-proposition from their perspective,” said Arvind Singhal, chairman of Indian consulting firm Technopak.
“It is probably true that the progress in executing this vision has not been as per the original expectation of Reliance, but then it would have been a miracle had everything gone as per the plan,” Singhal said. “Reliance is known to be very quick in adapting [and] course-correcting, and hence it is still very likely that JioMart would achieve its original objectives.”
— Diksha Madhok contributed to this report.