Facebook-Jio: As Ambani & Zuckerberg Join Hands, Will This Disrupt Or Disturb The Retail Industry?

Facebook has officially ‘liked’ Jio and they are ‘in a relationship’ now!

Consumers are a major source of data, as well as the product for various companies. When these two tech giants who are extremely popular come together, will it create chaos or will it lead to some balance?

Recently, there was huge news that was making rounds. The tech giant, Facebook, had acquired a roughly 10% stake in India’s favorite company, Jio. This deal was sealed for $5.7 billion. This deal came as a surprise for everyone. No one knew that the biggest social media platform would team up with the biggest internet service provider of our country. Facebook is known to buy out its competitors so that it can emerge stronger. They acquired WhatsApp for $19 billion and also bought Instagram after various negotiations. Facebook knew that they can never ever in their wildest dreams enter the Indian market without any competition from jio. Jio is the heartthrob of Indians and has acquired most of the telecommunication market. So now to move ahead and create a monopoly, these two giants merged and they are ready to create chaos in the market. They can be highly disruptive for all other competitors. Just like jio has crushed all other telephone operators, this clan which is made can disrupt the whole retail sector. 

How Will This Venture Disrupt The Indian Standard Framework?

  1. They will start by eliminating competition. There are various companies like jio mart in India who are doing fairly well. A company can only work in India if it gives a whopping discount. If we go back in time, the major reason for the success of jio is that they gave away free sim cards and attracted the youth. After 3 months, they stopped giving them and by that time, people were addicted to the internet and they started purchasing the data packs from jio. So now in this scenario, jio and Facebook, together can offer massive discounts to the people because they are already huge. If they sell a coffee packet for Rs100 but others sell it for Rs140, a basic Indian customer will always purchase it from jio mart and will wait for more discounts. This way they can gather a huge number of customers and wipe off all the other start-ups and middle level companies. Guess what? the companies flourishing right now must beware of the big clan coming in the industry. 
  2. Second and a very major issue will arise about the privacy. Jio has been very upfront about their privacy policy. They have always made it clear that they can share personal data about any customer when needed to provide advertising and promotional services. India does not have a data protection act in the country. There is no data protection regulator and a checker. Facebook and jio together can do anything with our data and since there is no one to check them, they will do so all the time. They have to be answerable to the global courts who regulate this sector but if there is no watchdog in our own country, how can we expect the global regulators to help us in the best way?
  3. The competition in India is managed too. Companies can not just barge in and create a huge monopoly and benefit from it for years. But in this situation, the Indian competition law is not so rigid. There are no clear rules about the digital technology businesses so till the time a law does not come up, jio and Facebook can have the time of their lives.
  4. The amount of issues popping out is also massive like net neutrality, competition, and data privacy. All these issues need to be addressed properly right now. 

What actually went down in Ambani’s and Zuckerberg’s head?

By the exact statements made by both the CEOs, it seems as if they are working for the welfare of the people. “India has more than 60 million small businesses and millions of people rely on them for jobs. With communities around the world in lockdown, many of these entrepreneurs need digital tools they can rely on to find and communicate with customers and grow their businesses. This is something we can help with — and that’s why we’re partnering with Jio to help people and businesses in India create new opportunities. I want to thank Mukesh Ambani and the entire Jio team for their partnership. We’re looking forward to getting started,” Mark Zuckerberg said in a statement.

While Mukesh Ambani also made a statement in the same context saying, “The synergy between Jio and Facebook will help realize Digital India Mission with its two ambitious goals — Ease of Living and Ease of Doing Business for every single category of Indian people without exception. In the post-Corona era, I am confident of India’s economic recovery and resurgence in the shortest period of time. The partnership will surely make an important contribution to this transformation.”

  • The deal is focusing on the ‘jio mart’ segment as per reports. This deal will be major hit across the country and will have a major impact on the retail as well as the internet market. The major idea in the minds of people handling Jio was that they would connect the local kiryana shop owners who are using WhatsApp so that they can indulge in online retailing. They were aiming to expand the grocery side and promote the digital India initiative. There were already talks about the emergence of Jio Mart and this deal aims to fulfill that. Through this, large numbers of vendors can come together and create a market on jio mart. WhatsApp has 400 million users from India and if the retailers out of that start cooperating with this deal, the competition will be massive.
  • This deal will also be a pavement for the virtual reality sector and the 5G sector. This will transform our country completely.
  • The customer base of jio is huge and so is for Facebook with some customers overlapping. So when these two join, they can together have a huge customer base and can cater to the major part of India. Jio has started the trails for this new venture already in Navi Mumbai, Thane, and Kalyan besides RIL ownership in 6,700 big and small cities of 10,900 retail stores, employing 1,25,000 people. Facebook and jio have access to billions and billions of people’s data and they can easily use it for their own benefit.

Pseudo-Benefits Of This Deal

  • For the internet sphere in India: this merger or new entity can help in the financial inclusion of the users of WhatsApp and they may promote the upcoming WhatsApp UPI platform. Facebook has also indulged in Libra cryptocurrency service and this deal is a step ahead in its direction. But the fact is that India doesn’t really needs all these hi-tech solutions because of poverty and hunger here.
  • Small businesses: the main aim of this deal is to uplift the small sectors and go digital. Millions of small sector enterprises will get a boost and go digital as a part of their development. But the question is that will the small businesses even exist after this lockdown because the government hasn’t given any realistic hope to them till now.
  • Retail sector: The retail sector will get a boost as new competition emerges. Since new players come, the already existing ones will thrive for excellence and will try to be better which will be a good situation for the people.
  • Employment: as promised, this deal fosters entrepreneurship and will generate employment. The majority of the Indians have lost their jobs because of the virus, this deal will help to give a boost to the people.
  • Digital India: it’s not a shock when we say that PM Modi and Ambani are best buddies who help each other and try to manipulate people. Best friend number one, Ambani is just helping to give a jump to the best friend number two’s digital India initiative. We also sense that there will be an addition of a third person, Mark Zuckerberg to their friendship.

Let’s hope for the best and not get blow away by the short term benefits of this deal.

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