Team-BHP - Google eyes stake in Vodafone-Idea. Facebook bought stake in Jio. Why?

Quote:

Google is in initial talks to buy a stake of about 5% in cash-strapped Vodafone Idea, India’s third-largest telecom operator, the Financial Times reported, citing people familiar with the matter. Vodafone Idea was formed in August 2017 by the merger of Vodafone India and Idea Cellular.

The FT report said Google’s parent Alphabet was in talks to buy a stake in Reliance Industries Ltd’s Jio Platforms but lost out to Facebook in closing the deal. “Pursuing Vodafone Idea instead would potentially pit Google against Facebook and an increasingly dominant Jio but the company could also make multiple investments in India,” the report said.

Industry executives and analysts were sceptical about any Google-Vodafone Idea deal.

According to a global analyst, the money that Vodafone Idea would get from a 5% stake sale would not move the needle in terms of the telco’s liabilities, such as the AGR payment. “VIL doesn’t have tech presence. It is a wireless company and does not even have a retail presence,” said the analyst.

Google eyes stake in Vodafone-Idea. Facebook bought stake in Jio. Why?-fbgvi.jpg

Source

Many possibilities

- Could be just a baseless rumor by an over-enthu reporter which then gets replicated

- Could be for access to customer data. Low valuations; cash strapped company for a viable country (still growing vis-a-vis global situation)

- Competition matters. If Facebook is betting on the Indian market, Google can't just ignore and sit on the sidelines.

Honestly, IMO it's the first case. They probably just voiced the option as a comparison aspect when they were in the hunt for Jio deal; and things just were taken out of situation.

Quote:

Originally Posted by Eddy (Post 4813531)

I don't really care as long as it drives the Idea Vodafone share prices.

Expect Microsoft to also join the bandwagon (with Jio most likely).

“Microsoft has been in discussions with several players in the digital payments services space. With Reliance, Microsoft is interested in buying a more than a 2.5% stake in Jio Platforms,” one of the two people cited above said, seeking anonymity.

If the negotiations are successful, the world’s most valuable company will get a slice of Jio Platforms that has already attracted investments worth $10 billion in just a month from marquee investors, including Facebook Inc., KKR & Co., Silver Lake, Vista Equity Partners and General Atlantic.

While Microsoft has shown a keen interest in cementing its partnership with Jio Platforms by buying a stake in the company, there is no guarantee that the investment will go through, the second person said, also requesting anonymity.

In February, Microsoft’s chief executive Satya Nadella said the company has forged a partnership with Reliance Jio. As part of the deal, Reliance Jio plans to set up data centres across the country and use Microsoft Azure’s cloud services for enterprise clients.

While a Microsoft spokesperson said the company does not “have any information to share here”, an email sent to Reliance Industries did not elicit a response.

Foreign investors are making a beeline for Jio Platforms as they seek to tap India’s fast-growing digital market. Jio Platforms combines all of Reliance’s digital and telecom initiatives, including Jio digital services (mobile, broadband), apps, tech capabilities (artificial intelligence, Big Data, Internet of Things, etc.,) and other investments such as in Den Networks, Hathway Cable and Datacom Ltd.

Source: Hindustan Times

Microsoft recently bought Affirmed Networks which works in 5G infra area. With 5G, lot of things are going to get integrated.

Data centres, cloud infrastructure, edge computing to name a few and big data and machine learning at edge. It will have impact on everything from autonomous cars, automated factories, healthcare, utilities etc. Everything could be sold as a service. So end to end service offerings will increase.

Idea Vodafone in India have been in deep trouble for quite sometime now and they do not have the reach and nor the extensive collaborative platforms that Jio brought in from day one. Jio is an ecosystem on its own today, wireless, Broadband, Movies, content, now Jio Mart, and lets not forget that Reliance also owns a lot of media companies like TV18, plus an equal stake in Viacom18 and so much more.

And in contrast Idea Vodafone have nothing, just a wireless network. They do not even have broadband and satellite network like Airtel. So I really think this is just an imagination of a over enthusiastic reporter and nothing more.

If google wanted to do something big, they should probably come in pick up a stake in a new age digital company like say Ola, or Paytm or something like that. Or even buy a stake in the Walmart owned flipkart group, to get a entry to the e-commerce market in some way. Else they can just wait and watch. No point in investing in a bygone company like Idea Vodafone.