Name: Manish Giri

Roll No: 190301010

Draft Questions on Facebook-Jio Collaboration in India

Que 1. How has the advent of Reliance Jio impacted the growth of Internet consumption in India
and what future scenario can be depicted?

Answer:

The telecom market of India was captured by players such as Bharti-airlet, Idea, and Vodafone.
Reliance Jio was launched in September 2016. The entry of Reliance Jio was considered to be the
second telecom revolution in India because Reliance Jio became the most significant internet
provider within four year time spam. Reliance Jio contributed 34% of market share and 344 million
customer Base.

Reliance Jio offered low price internet services and an abundance of internet data to customers. This
led to the company an unprecedented success, making it the number 1 company in the Indian
telecom market.

The growth in internet users in India is because of cost-effective, easily accessible internet plans
offered by Reliance Jio and affordable smartphones. It is predicted that India would have 2.1 billion
internet-connected devices by 2023.

Reliance Jio is offering an unprecedented service to its customers by adding values into its
services. The launch of Jio Mart in December 2019 is the first step into e-commerce space. The
company plans to offer O2O (Offline to Online) model, under which consumers search products or
services online and bought it offline. The partnership of Reliance Jio with Facebook in April 2020
made a big move to transform the e-commerce. With this deal, Whatsapp as a communication
system, Facebook as social media commerce, and JioMart as e-commerce would tap the largest
untapped rural & semi-rural population of India.

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Name: Manish Giri
Roll No: 190301010

Que 2. Should Jio Platforms aggressively pitch for 5G adoption in India? How will it benefit the
company?

Answer:

Now, India focuses on a digital plan to transform the country, connecting its remotest corners so
people can reap the benefits of digital inclusion. 5G could have numerous impacts on people’s daily
lives, irrespective of where they live. 5G technology can bring socio-economic growth to the nations.
It will enable a connected, digital society. It will build a scale of billions of connected mobile phone
devices and a global ecosystem for vendors and consumers.

The Jio Platform is combining all the digital businesses under one umbrella that includes Reliance Jio,
MyJio, JioTV, JioCinema, JioMoney, JioNews, and JioSaavn, etc. As the Jio Platform business model is
entirely based on the internet, the use of high-speed internet connectivity and sustainable and
affordable internet will be favorable to the company.

5G would change commerce permanently. The early movers will get benefit by gaining the right
experience and creating new use cases.

Jio Platforms can be benefitted in the below manner:

 Improve the customer experience. The advent of high-speed internet improves the customer
experience while browsing over the e-commerce site.
 More customers, more revenue.
 Easy to use VR & AR technology. Both technologies can help transform the online buying
experience. Hence O2O business can increase its offerings.
 AI Assistance: the speed of 5G and the power of AI enable e-commerce businesses to serve
their customers with online intelligence.

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Name: Manish Giri
Roll No: 190301010

Que 4. What are the pros and cons of O2O model for retail business in India? Is this the best
marketing/ operational strategy that Reliance Jio can adopt, leveraging its collaboration with
Facebook?

Answer:

The Online-to-Offline (O2O) is a renovated business strategy that utilizes technology to connect
online customers to an offline business.

Pros:

 O2O business model fits consumers’ shopping behavior of the new generation.
 Development in mobile technology provides enormous potential for O2O business.

Cons:

 The future of this industry is unpredictable.

 The new business model will make a shift.
 Consumers might change to other service providers if they have a more attractive discount
or some other promotions.

The Reliance Jio plans to operate on O2O model in collaboration with Facebook increases its reach to
the untapped population of India, which resides in rural and semi-rural locations. Facebook, which is
social commerce with its customer base of 2.4 billion, Whatsapp, which is a communication system
with its customer base of 1.5 billion and Instagram, which is a social platform with 1 billion users are
providing substantial customer information to Reliance Jio. This information is useful to find out the
needs & wants of the consumers.

 Collaborating with Facebook, Reliance Jio is:

 Enhancing its customer base
 Getting money to reduce its debt burden
 Taking advantage of communication channel Whatsapp to reach customers
 Ready to explore the untapped population of India.

By observing the above, we can say with confidence that the marketing and operating strategies of
Reliance Jio will further raise the growth of the company.

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Name: Manish Giri
Roll No: 190301010

Que 8. Is there a case for stronger engagement by CCI to scrutinize the Facebook Jio Deal? On
what grounds?

Answer:

Facebook invested in Reliance Platforms through FEMA Act 1999 and didn’t require approval from
the Government of India. However, the approval from the Competition Commission of India was
necessary. Facebook invested US$5.7 billion into Reliance Platforms and acquired a 9.99% stack. This
investment made the valuation of Reliance Platforms at US$ 65.95 billion, making it one of the top
five listed companies in India.

Although both companies assured that the purpose of this agreement was to create new
opportunities and expand the ecosystem of fair business opportunities, there is no preferential
treatment envisaged by any one party to the other. But, concerns were raised that this deal would
give undue advantage to both the companies.

The ground of the concerns are:

1. Reliance Jio had about 388 million subscribers, whereas Facebook had 2.4 billion users on its
Facebook platform, 1.5 billion users on WhatsApp, and 1 billion users on Instagram. The deal
was going to impact a considerable portion market in terms of consumers’ numbers.

2. The vast amount of customer related data available with both companies would give both of
them an unfair competitive advantage.

3. Data privacy of Indian consumers is on stake because of the absence of a duly constituted
data regulator.

Therefore, scrutiny by the CCI was necessary for the view of the size of companies, the scale of the
market, and their intended business models.

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