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Google is to invest $4.5 billion into Indian internet company Jio Platforms, Google chief executive Sundar Pichai confirmed on Wednesday.
Jio Platforms owns India’s biggest telecoms provider Reliance Jio as well as a suite of homegrown apps such as Zoom rival JioMeet.
The investment gives Google a 7.7% stake in Jio Platforms, providing the deal is cleared by India’s regulators.
Reliance Jio’s founder, Mukesh Ambani, is currently the sixth-richest man in the world, with a net wealth of $72.4 billion.
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Google will invest $4.5 billion in disruptive, popular Indian internet firm Jio Platforms, the company confirmed on Wednesday.
The deal gives Google a 7.7% stake in the company, pending approval by Indian regulators.
The two firms plan to develop an entry-level Android phone that could bring millions more Indian users online.
Google CEO Sundar Pichai, announcing the deal on Wednesday, tweeted: “Everyone should have access to the internet. Proud to partner with @reliancejio to increase access for the hundreds of millions in India who don’t own a smartphone with our 1st investment of $4.5B from the #GoogleForIndia Digitization Fund.”
A subsidiary of Indian conglomerate Reliance, Jio Platforms owns India’s biggest mobile operator Jio, which has a subscriber base of 369.93 million and more than 30% market share.
Jio Platforms also owns a suite of homegrown internet apps, including Zoom rival JioMeet and music streaming service JioSaavn.
The funding is part of a slew of Google initiatives in India. CEO Sundar Pichai recently held a video call with Indian prime minister Narendra Modi. And the $4.5 billion cash injection comes from a new $10 billion fund that Google plans to invest in India.
Pichai is also friendly with the founding family behind Reliance Jio, the Ambani family, attending scion Akash Ambani’s wedding in Mumbai in 2019.
Other major tech firms have already invested billions in Jio Platforms. Facebook announced a $5.7 billion investment in April. Qualcomm announced this week it was investing around $100 million, while Saudi Arabia’s Public Investment Fund, KKR, Vista Equity Partners, and many others have invested billions in recent months.
The ‘Jio effect’ has had a huge impact on Silicon Valley
Jio’s rise in India has been meteoric.
The Reliance subsidiary has brought millions of Indians online for the first time over the past four years by offering free or incredibly cheap 4G data.
This wave of new internet users has benefited the likes of Google and Facebook, both of which are experiencing saturation in the West and are increasingly looking at Asia and emerging economies to provide their “next billion users.” Facebook explicitly called out the positive effect of cheap data plans in emerging economies on its user growth back in 2016, and repeatedly describes India is its fastest-growing market.
As Business Insider previously reported, one side effect of millions of new Indian users flooding the internet was the dethroning of popular gaming YouTuber PewDiePie as the top creator on the platform. He was replaced by T-Series, an Indian record label that garners hundreds of millions of views by posting Indian music videos to YouTube and is little-known outside the country.
Meanwhile, Reliance chairman Mukesh Ambani is now the sixth-richest person in the world, per Bloomberg’s Billionares Index, surpassing Tesla CEO Elon Musk with a net wealth of $72.4 billion.
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