Facebook has announced to invest $5.7 billion (~ INR 43,574 crore) in the Reliance Jio for a 9.9 per cent stake in the telecommunication subsidiary. Notably, it’s the largest minority stake investment in the tech industry as well as the largest FDI in the Indian tech sphere so far.
Interestingly, it is the tech giant’s third major investment in Indian companies in the recent times. Facebook had also invested in the Indian EdTech startup, Unacademy earlier this year. Moreover, it had also invested in the Indian social commerce platform Meesho in June 2019.
Remarkably, India has emerged as one of the growing markets for internet in the world. Facebook has long enjoyed a strong user base in the country. Facebook owned messaging platform WhatsApp has currently over 380 million Indian users. On the other hand, owing to its competitive pricing strategies, Jio has also become India’s leading telecomm service providers.
However, more recently, TikTok seems to have taken over the social media world by a storm with over 250 million users in India alone. The latest Facebook-Jio deal is expected to help both the firms get a stronger footing in the Indian market. Furthermore, experts have also speculated that the strong political backing from Mukesh Ambani can be another reason for Facebook’s latest investment.
Moreover, the two companies are also expected to collaborate on various projects in the upcoming months. The leading social media conglomerate has said that it will work with Jio to empower people and businesses in India to operate effectively in the emergent digital economy.
Particularly, Facebook and Jio are likely to begin by boosting Jio’s online grocery delivery platform, JioMart. Jio is hoping to leverage on WhatsApp to offer online payment services to millions of grocers in the country and further boost JioMart. Additionally, the collaboration will also offer a direct way of revenues for the upcoming WhatsApp payment service.
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