Google Is Planning To Invest Up To $1 Billion In India Telecommunications Operator Airtel
Google is planning to invest up to $1 billion in India telecommunications operator Airtel
According to reports, Google is investing $700 million in Indian telecommunications operator Airtel, the latest in a series of investments in the world's second-largest internet market as part of a $10 billion investment in the country.
A $700 million investment by Google to acquire a 1.28 percent stake in Airtel, India's second largest telecommunications company with more than 300 million subscribers, was announced today, along with an additional $300 million investment to explore long-term commercial agreements with the telco.
The two companies announced that they will collaborate to expand on Airtel's extensive offerings to provide consumers with a variety of Android-enabled devices through "innovative affordability programs," according to a joint statement. The companies also stated that they will investigate collaborations with smartphone manufacturers in order to "reduce the barriers to owning a smartphone across a spectrum of price points."
In a joint statement, Google and Alphabet CEO Sundar Pichai said, "Airtel has been a pioneer in defining India's digital future, and we are proud to collaborate on our shared vision for expanding connectivity and ensuring equitable Internet access for all Indians."
This commercial and equity investment in Airtel is part of our Google for India Digitization Fund's efforts to increase smartphone access, improve connectivity to support new business models, and assist businesses on their digital transformation journeys.
The announcement on Friday comes at a time when Airtel and Vodafone are attempting to find ways to repay billions of dollars to the Indian government. In a recent transaction, Vodafone transferred more than 35 percent of its shares to New Delhi, establishing the Indian government as the company's largest shareholder.
Vodafone and Airtel Competition
Vodafone and Airtel compete with Mukesh Ambani's Jio Platforms, which are owned by his son. The low-cost voice and data services provided by Jio Platforms have resulted in the company amassing over 400 million subscribers in India. Google will invest $4.5 billion in Jio Platforms by 2020, according to the company. That same year, Ambani's company received support from Facebook as well as nearly a dozen other companies.
Airtel announced on Friday that it will collaborate with Google to explore "broader strategic goals" and "possibly" co-create India-specific network domain use cases for 5G and other standards. The collaboration will take place over the next several months. They also intend to collaborate on "shaping and growing" India's cloud ecosystem, which they described as "a priority." Airtel, which already provides enterprise connectivity to over one million small and medium-sized businesses through its enterprise connectivity offering, stated that Friday's announcement will "assist in accelerating the adoption of digital technologies."
"Airtel and Google are working together to increase India's digital dividend through the development of innovative products. We look forward to working with Google to deepen and broaden the depth and breadth of India's digital ecosystem, using our future-ready network, digital platforms, last-mile distribution, and payments ecosystem, to name a few examples "Bharti Airtel Chairman Sunil Bharti Mittal made the announcement in a statement.
In Conclusion
India is one of the last great growth markets for American technology companies, with more than 600 million internet users — and an equal number still to come online — and a large number of potential customers. Over the last decade, Google and Facebook both ran programs to connect tens of millions of Indians to the internet, and the results were impressive.
