Facebook officially confirmed its deal on Wednesday, which gets them 9.9% stake in Jio.
Facebook and Reliance Jio made their expected deal official on 22 April, which allows the social networking giant to buy 9.9% stake in Jio for over Rs 43,000 crore. But this deal is more than just a financial arrangement. After all, we're talking about the synergy between products like WhatsApp, JioMart, Jio TV, Facebook Watch and so much more.
Facebook will be targeting Jio users (biggest telco in the country) with its advertising model, something that could benefit Jio as well, which has failed to monetise all its users, except for making them pay for the data plans.
JioMart enters the big stage
JioMart could rely on WhatsApp and its business partnerships could onboard offline retailers from different parts of the country, and using WhatsApp becomes an instant attraction point for the sellers, who can easily connect with their customers, and digitise their business as well. We've already seen during the lockdown how many local Kirana stores are accepting orders through WhatsApp, and some of them are even open to taking payments through mobile apps. With the help of Jio's extensive reach with 4G across the country, these two giants can sign up more retailers than its competition.
Facebook could use Jio and its userbase to increase its ad revenues from the Indian market, something that will surely concern Google and even Amazon to some extent.
Going beyond retail commerce
Moving beyond commerce, Facebook will be hoping the regulatory hurdles for WhatsApp Pay will pave way for the ecosystem to finally make its full-fledged debut in India over the coming months.
Both Jio and Facebook have also laid their eyes on the gaming, video segment. In addition to this, they aspire to make the VR segment reach its potential. Most experts suggest Jio could be Facebook's route to make monetisation through WhatsApp viable and successful as well.
Data privacy concerns arise
The partnership comes with big Asterix at the top, something that will alert the privacy authorities. Facebook and Jio will have access to millions of users, and their data. Facebook's recent history with user privacy puts them in a precarious position with the country's regime, and they would have to engage with more representatives now that their entry into India's other markets has been smoothened courtesy its minority stake in Jio.
There's a lot riding on this deal but one thing is for sure, Facebook can forget about trying its luck with Free Basics program once again.
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