Virgin Media to make COVID-19 retail closures permanent

Virgin Media has made the decision to remove itself from the high street, permanently closing its 53 retail stores which have been shut during the COVID-19 lockdown period.

Trends have been shifting away from in-store purchases for years, and it appears the pendulum has swung far enough for Virgin Media. None of its 53 retail locations will be reopened following the period of lockdown, with the 341 employees all being offered alternative roles in the business.

“We are focused on delivering the service customers want, in the ways they want it and at a time and a place that suits them,” said Rob Orr, Executive Director for Sales at Virgin Media.

“By creating new jobs in our most popular care and sales channels, we will be better able to provide our customers with the top service and support they rightly expect while retaining our talented workforce.”

Virgin Media has said at least 300 new customer service roles would be created to compensate for lost in-store roles, the majority of which will be work-from-home roles. The majority of sales already take place over the phone or via other digital channels.


Is there any need for a high-street presence for the telcos nowadays?

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Virgin Media is the first company to make such an announcement, but we suspect there will be others. We are not necessarily limiting our assumption to the telecoms and technology industries, but this lockdown has shown that operations can continue with physical shops or offices, therefore digital transformation programmes might be encouraged.

Looking specifically at the telco space, Vodafone is currently working on a phased reopening plan for post-lockdown, and although it cannot guarantee it will be able to reopen every location, that is the plan. BT will also implement a phased reopening strategy, opening as many locations as Government guidance will allow for.

At the time of writing, O2 and Three had not responded to emails from Telecoms.com.

There might of course be accountants and strategists who would want to close down physical sales channels, digital is much more profitable after all, but this is unlikely to be the case for mobile network operators.

As many customers would be interested in seeing and holding a smartphone before signing a £1000 cheque, a retail presence would be desirable. Closing down these shops might encourage customers to look at devices elsewhere, which might mean losing a postpaid customer. It is a delicate balance, but perhaps a necessary cost, at least for the moment.

Virgin Media is in a different position; how many people want to inspect a router prior to buying a broadband package. It might sound like a negative for the business, but realistically it probably is an unnecessary expense. COVID-19 was probably a contributor to the decision to permanently closing the high street present, but we suspect executives have been discussing this for some time.

MTS delivers solid Q1 but provides cautious outlook

Russian operator MTS saw revenues grow 9% in Q1 but believes the whole-year performance is likely to be flat.

MTS has delivered a financially solid Q1 with a total revenue of RUB 119.6 billion ($1.7 billion), up by 8.9% year-on-year. The company’s OIBDA grew by 1.6% to RUB 51.5 billion ($730 million), while net profit improved 0.8% to RUB 17.7 billion ($250 million) compared to the same period of 2019. The strongest growth comes out of its mobile and fixed telecom services, but about half of the top line growth comes from the adjacent businesses, including fintech, digital services, and retail.

“…this is an unprecedented time that is impacting billions of people around the world, including millions of our customers and thousands of our employees,” Alexey Kornya, MTS President and CEO, said during the earnings call. “Connectivity has never been more critical and we are proud to be helping our customers stay in touch with their friends and family as well as colleagues and classmates.

“Overall, I am deeply proud of the MTS team and would like to express my appreciation for their professionalism in this challenging environment. Looking ahead, I am cautiously hopeful for the future, and our strategic focus is clear: supporting our customers today while not losing sight of our goals for tomorrow.”

As Russia entered COVID-19 lockdown only at the end of March, its impact was not reflected in the Q1 results. However, MTS does provide a glimpse into the impact on April and the first half of May.

Similar to other operators that have witnessed during COVID-19, MTS has seen increased traffic but a big drop in retail with many shops are closed. Meanwhile, the operator has seen and expects increased digital activities, in communication, media, and in financial product consumption. In mobile, MTS has received the regulatory approval to implement self-registration SIM cards through an app.

“Looking ahead, we plan to prioritize this channel at the key level to lower subscriber acquisition cost,” said Inessa Galaktionova, First VP for Telecommunications. MTS is “also broadening our SIM-based infection tracking across all of our sales channels.”

“Now more than ever, consumers are shifting to digital-first banking from online customer service to virtual cards and contactless payments,” said Andrey Kamensky, VP for Finance, on the earnings call, suggesting there could be greater benefit for MTS.

Looking at the full-year expectations, MTS’s management is more cautious. Citing concerns including reduced number of retail outlets as well as the impact of lockdown on roaming income, the operator projects a 0% to 3% growth in total revenues and -2% to 0% OIBDA move, compared with 2019.

MTS is the latest of telecoms companies to show that the industry has withstood the uncertainties from COVID-19 well enough especially when it comes to coping with surging traffic, but it is certainly not immune to the impact. Factors ranging from reduced retail and roaming income due to lockdown to overall economic weakness are beyond the telecom operators’ control, but have or will have manifested on telecom operators’ quarterly and annual numbers.

A look back at the biggest stories this week

Whether it’s important, depressing or just entertaining, the telecoms industry is always one which attracts attention.

Here are the stories we think are worth a second look at this week:


Facebook reignites the fires of its Workplace unit

Facebook has announced its challenge to the video-conferencing segment and a reignition of its venture into the world of collaboration and productivity.

Full story here


Trump needs fodder for the campaign trail, maybe Huawei fits the bill

A thriving economy and low levels of unemployment might have been the focal point of President Donald Trump’s re-election campaign, pre-pandemic, but fighting the ‘red under the bed’ might have to do now.

Full story here


Will remote working trends endure beyond lockdown?

It is most likely anyone reading this article is doing so from the comfort of their own home, but the question is whether this has become the new norm is a digitally defined economy?

Full story here


ZTE and China Unicom get started on 6G

Chinese kit vendor ZTE has decided now is a good time to announce it has signed a strategic cooperation agreement on 6G with operator China Unicom.

Full story here


ITU says lower prices don’t lead to higher internet penetration

The UN telecoms agency observes that, while global connectivity prices are going down, the relationship with penetration is not as inversely proportion as you might think.

Full story here


Jio carves out space for yet another US investor

It seems the US moneymen have a taste for Indian connectivity as General Atlantic becomes the fourth third-party firm to invest in the money-making machine which is Jio Platforms.

Full story here


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Huawei’s Intelligent IP Network Solution Passes the EANTC Test

Huawei’s intelligent IP network solution recently passed strict tests conducted by European Advanced Networking Test Center (EANTC), verifying the commercial readiness of the solution’s key technologies and fully developed capabilities for the all-service intelligent era.

The solution is designed specifically to help customers build IP networks with intelligent ultra-broadband, connections, and O&M. It leverages NetEngine routers build E2E 400GE intelligent ultra-broadband IP networks and uses hard network slicing to guarantee and flexibly allocate the bandwidth for key services. With the industry-leading SRv6 technology, this solution provides intelligent connections, enabling fast provisioning of services (such as enterprise cloudification) and committed latency of key services. The combined use of iMaster network cloud engine (NCE) — the industry’s first platform with integrated management, control, and analysis — and technologies such as iFIT helps support automated and intelligent O&M throughout the entire lifecycle. The EANTC tests verified key technologies in Huawei’s intelligent IP network solution.

Intelligent Ultra-Broadband: E2E 400GE to Build Ultra-Broadband Networks and Network Slicing to Implement Flexible Bandwidth Allocation

The EANTC tests verified the ultra-high capacity, ultra-low power consumption, and all-scenario access capabilities of NetEngine 8000 series routers. Equipped with 400GE interfaces, these routers offer forward frames of various lengths at 100% line-rate with zero packet loss. In addition, the board power consumption is merely 0.28 W/Gbit. The tests also verified the industry’s only 80 km 50GE QSPF28 and 100GE QSPF28 optical modules and 40 km single-fiber bidirectional 50GE optical modules for commercial use, covering all-scenario access. Furthermore, the tests verified the bandwidth guarantee capabilities of hard network slicing. The bandwidth resources of different network slices are isolated throughout the entire lifecycle, and the bandwidth of services carried in each network slice can be 100% guaranteed. Meeting the high-precision time synchronization requirements posed by 5G networks, as verified in the tests, Huawei devices deliver industry-leading time synchronization performance. The devices demonstrated a maximum synchronization error rate of only 12 ns, which is significantly less than the G.8273.2-defined standard of 30 ns for Class C clocks.

Intelligent Connections: SRv6-Empowered Intelligent Traffic Steering and Committed Latency

Leveraging the industry-leading SRv6 technology, Huawei’s intelligent IP network solution can intelligently select the optimal path and adjust it in real time based on service intent and network congestion status to continuously provide the optimal connection experience. The tests verified that Huawei’s intelligent IP network solution uses SRv6+iMaster NCE to implement intelligent traffic steering based on various conditions, such as bandwidth, link cost, and latency. If the link quality deteriorates, SRv6+iMaster NCE implements route re-selection to achieve on-demand latency guarantee, with zero packet loss during path switching. The tests also verified the smooth evolution from MPLS to SRv6, meaning that VPWS and L3VPN services carried by MPLS can be seamlessly switched to SRv6-based EVPN services.

Intelligent O&M: Full-Lifecycle Intelligent O&M, Moving Towards Autonomous Driving Networks

Huawei iMaster NCE, an intelligent management platform, uses iFIT to deliver real-time visualization of service quality and minute-level fault locating. The tests verified that the combined use of iMaster NCE and iFIT performs hop-by-hop detection on packet loss and latency of each service on the E2E path and displays SLAs, such as service latency and packet loss rate, in real time. This combination ensures accurate fault location if network faults occur or service performance deteriorates, supports fast service recovery, and builds a highly reliable autonomous driving IP network.

Carsten Rossenhoevel, Managing Director of EANTC, said, ” Our rigorous, independent tests confirm that Huawei’s intelligent IP network solution supports a wide range of advanced, cutting-edge transport technologies and is functionally ready to serve both service provider and enterprise markets well. Throughout all evaluated aspects of functionality, performance, scalability, high availability, and manageability, Huawei demonstrated the strength of the solution to EANTC. Huawei has displayed industry-leading capabilities in providing more intelligent network experience in more complex scenarios and simplified service provisioning and network O&M through iMaster NCE.”

Huawei’s intelligent IP network solution was successfully validated in EANTC’s tests, showcasing Huawei’s industry-leading capabilities in IP network products and solutions for the all-service intelligent era. Huawei will continue to build networks that feature intelligent ultra-broadband, connections, and O&M, helping carriers around the globe build intelligent IP networks and supporting customers’ business success.

 

Appendix: EANTC Test Report:

http://www.eantc.de/public-reports.html

 

–End–

 

 

Nokia scores a new PON deal with Openreach

Finnish kit vendor Nokia received a boost to its fixed line business by securing a bunch of fibre work from UK network wholesaler Openreach.

Openreach is the semi-autonomous bit of BT that manages its wholesale fixed line network. As a consequence it is the company most responsible for rolling out fibre to the home across the UK, which means it needs lots of optical kit. Much of the announcement focuses on what a great idea fibre is, what with it being much faster than copper and all that, and how good for the country having more of it is.

They do eventually get to the point, however, noting that Nokia’s contribution to the Openreach fibre rollout, which is aiming to reach 4.5 million premises by the end of March 2021, will focus on deploying GPON and XGS-PON access technologies. This will futureproof the network by giving it the ability to deliver up to 10Gb/s symmetrical broadband speeds in the future, as well as giving it the latest virtualization bells and whistles.

“We’re accelerating our full fibre build to deliver an ultrafast, ultra-reliable and futureproof broadband network throughout the UK,” said Clive Selley, CEO of Openreach. “This new digital platform will help our economy to bounce back more quickly from the COVID-19 pandemic – enabling people to continue work from home, and millions of businesses to operate seamlessly online for decades to come.

“Right now, we’re making the new network available to around 32,000 homes and businesses every week, and Nokia’s innovative solutions are helping us to build it better, broader and faster. Our partnership with Nokia will be critical in helping us to upgrade the nation and hit our target of reaching four and a half million premises by the end of March 2021.”

“Ensuring everybody has access to broadband services is critical, especially during unprecedented times like these where it has become the lifeline to millions working, handling healthcare and learning from home,” said Sandra Motley, President of Fixed Networks at Nokia. “Our fiber solutions will help Openreach bring enhanced ultra-broadband services to millions of new customers across the UK today while our 10G PON technology will help to futureproof their network against whatever may come next.”

All this general talk about the virtues of fibre creates the impression that the deal itself isn’t amazingly significant. On the other hand it at least confirms Nokia’s role in the UK’s fibre network and permits the two companies involved to do a spot of connectivity virtue signalling, so fair enough.

Will remote working trends endure beyond lockdown?

It is most likely anyone reading this article is doing so from the comfort of their own home, but the question is whether this has become the new norm is a digitally defined economy?

With many economies and sectors dependent on a fully functioning telecoms network and a healthy digital ecosystem, perhaps we should be wondering why the idea of remote working is not more common. Many companies would say they are forward-looking and innovative, but the vast majority were forced through a digital transformation programme by the COVID-19 pandemic, not their own choosing.

The issue with coerced evolution is that there is a temptation to return to the ways of old, heading back to stodgy offices as the unambitious, unimaginative and uninspiring crave the familiarity of the known. Managers might say ‘teams work better when we’re together’ or ‘we’re an industry where it doesn’t work’, but this is probably a cover. The fact that many businesses still function during lockdown shows this is not true.

The office will never become extinct and face-to-face meetings will always be a requirement, but not every day; such resistance is simply an admission of inability to adapt to a changing economy or evolving society. Said managers would probably have fit in very well at Blockbusters when Reed Hastings pitched Netflix.

There are of course some jobs where working from home is an impossibility, but the fact that the economy

Today’s working practice is an extreme. But one would hope organisations at least take some of today’s mobility and incorporate into tomorrow’s operations. Some will revert to the analogue era, convinced that ‘hot desking’ is progress, but hopefully the majority will evolve and learn from this period of rapid transformation.

Of course, what is worth noting is that some serious changes will have to be made to ensure operations are in a healthy and sustainable position. Some companies might be managing the strain of remote working well today, but who knows which straw might be the fatal one.

A recent survey from Cato Networks suggested 55% of respondents experienced an increase of 75%-100% in remote access usage, while 28% saw usage shoot up more than 200%. VPN’s might be the most common form of remote access technologies, but products are bought for a purpose; most will not be designed for the surge above normal requirements.

67% of the respondents to the survey said complaints had been lodged from remote users, where connection instability and slow application response are the leading problems. Cato suggests the VPN might be a choke point in operations as it uses public internet to backhaul traffic to a datacentre or up to the cloud. In short, there will have to be a rethink on how money is spent and on what.

“…on the front-end you’d be looking at redundant VPN servers, ideally in each region where remote users operate,” said Dave Greenfield, Technology Evangelist at Cato Networks.

“For security, you’ll need antimalware and URL filtering. For the backend, you’ll need to connect and secure your cloud applications and resources. This says nothing about any of the management or troubleshooting tools that might be needed to support remote users.”

This is a disruption to business operations, and whenever there is a disruption, there are those who prefer the quieter life of the status quo. Every organisation has individuals who would rather this stay the same and this is the risk today; how many organisations will return to the pre-COVID-19 way of working, rendering these enforced digital transformation projects temporary.

Wind River, a software provider for connected systems and another company hoping to benefit from the pandemic transformation, is suggesting COVID-19 has caused 90% of enterprises to undergo some change in business processes, with 90% of respondents suggesting there has been an impact on being able to meet customer demands. Again, this might force companies back to old ways as some people simply don’t like challenges.

Interestingly enough, the Wind River research also suggests that IT spend on cloud-based application development has and will increase by 35% because of the coronavirus-enforced periods of lockdown. This increases to 62% in China. This shift to cloud-based technologies and processes should theoretically enable mobility in the work and flexibility in working practises.

Ultimately, the issue with some of these survey’s is that decision makers are the respondents, many of whom will say the right things because they believe they are the right things to say. This does not mean they are empowered to make changes or even have the staying power to see through any form of evolution. Sometimes it is best to ask the foot soldiers, those who fight in the trenches each day, those who are slightly more immune to the politics of business and may well give a more straight forward answer.

When asking Telecoms.com readers whether they thought the flexible and remote working conditions would stay, the results are quite interesting.

  • 50% said they would have to check into the office once or twice a week but could work from home
  • 33% believed they would be given complete freedom to work as they please
  • 6% stated they would have to go into the office to do their job properly
  • 6% thought the management team is not convinced by the idea of working from home and the company would revert to old business practices
  • And the final 5% said they would have to go into the office, but others in the company would be allowed to work from home

Of course, the adaptability of employees and employers is one on element of the equation, there will have to be the communications infrastructure in place.

What will be encouraging for all involved is the resilience of networks as internet traffic surges. These networks have not been designed with the current working dynamic in mind, but performance has been maintained.

According to data from Netscout, internet traffic jumped between 25-35% on home broadband networks from mid-March, when most lockdown protocols were being enforced. What is worth noting is this is a global average, some markets have experienced much higher peaks, for example Italy and the UK. But most importantly, networks have not failed because of the increased strain.

Interestingly enough, speaking at a Time Higher Education conference this week, Muhammad Imran, a Professor of Communication Systems at the University of Glasgow, suggested the work from home trends could be aided by the embracement of smart cities initiatives.

The ‘Accessible City’ is an idea which can help people work remotely. Imran has questioned why people should have to move to work in some jobs, a factor which could lead to an offer falling through or being turned down. Not everyone can move for a job, and for some low-income families it could be a barrier to entry.

Remote and flexible working is not only an opportunity to increase employee welfare, but it could also democratize some careers, breaking down social barriers and opening up opportunities for those who would have previously been overlooked.

Another element to consider is whether people are actually better at their jobs when they work from home.

Research from Harvard Business School suggested a 4.4% increase in output from those who have been empowered to work from home, while software company Prodoscore has said productivity could go up by as much as 44%. Numerous research papers have pointed to remote working being a plus to employers, as well as a benefit to employees.

Despite this research, which has been around for years, most executives have resisted the temptation to evolve working practices, leaving the idea of remote and flexible working to be cultivated by others, most of the time digitally native organisations. Some companies, and people, are stuck in their ways and they will not be as attractive to potential employees as others.

Some will embrace the coerced digital transformation, and some might revert back the ways of old. It will be interesting to see which business leaders are stuck in a previous generation.


Telecoms.com Daily Poll:

Can the sharing economy (ride-sharing, short-stay accommodation etc.) survive COVID-19?

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ITU says lower prices don’t lead to higher internet penetration

The UN telecoms agency observes that, while global connectivity prices are going down, the relationship with penetration is not as inversely proportion as you might think.

An International Telecommunication Union analysis of mobile and fixed connectivity has found that prices are decreasing, on average, across the world. Disappointingly for the agency, since lowering prices is one of its big things, this trend is not translating into rapidly increasing internet penetration rates. So it looks like there are other factors involved, such as quality of service, level of education and lack of localised content.

In spite of that, the ITU seems to be sticking with its price narrative. “Keeping telecommunication and digital services as affordable as possible has always been important to ensure broader Internet uptake, especially for lower-income households and consumers,” said Houlin Zhao, ITU Secretary-General. “In the face of COVID-19, this is more vital than ever. People who do not have access to the Internet may not be able to access information about how to protect themselves from coronavirus, telework, learn remotely and connect with families and friends during quarantine.”

“The COVID-19 crisis has clearly shown us that nobody is safe until we are all safe,” said Doreen Bogdan-Martin, Director, ITU Telecommunication Development Bureau (has it?). “By the same token, we will not be able to use the full potential of digital technologies until we are all connected. To connect all, we need to address all factors that may prevent meaningful connectivity.”

It’s not clear what the ITU top brass is getting at, other than to vaguely imply that it’s really important to have agencies like the ITU. If you fancy a bit of light reading to see you through the lockdown, you can download the 178-page report here. Universal connectivity is desirable but not essential and some parts of the world may feel there are matters in more pressing need of their scarce funds.

Telecom Italia wrestles with Europe’s biggest COVID-19 dent

Telecom Italia (TIM) has released its latest financial results, revealing painful battle scars as European nations continue to fight the coronavirus pandemic.

While it should come as little surprise when you look at which countries were most severely impacted by COVID-19, the figures have confirmed it. Telecom Italia is still profitable, which is often forgotten when companies miss expectations, but the impact of the coronavirus pandemic has been very notable.

Total revenues for the three-month period to March 31 stood at €3.9 billion, down 11.3% year-on-year, while profits declined 10.8% year-on-year to €1.7 billion.

Financial results for European telcos through to March 31 (Euro (€), thousands)
Telco Revenue Year-on-year Profit Year-on-year
BT (£) 5,632 -4% 2,007 -2%
Telecom Italia 3,964 -11.3% 1,735 -10.8%
Orange 10,394 1% 2,602 0.5%
Telefonica 11,366 -5.1% 3,760 -11.8%
DT 19,943 2.3% 6,940 7.4%

Although it does look like business as usual at Deutsche Telekom, let’s not forget that as well as the country effectively combatting the coronavirus, the Group also contains T-Mobile US, which has been flying over the last few years. Total revenues in the US grew 0.3% to $11.1 billion over the quarter, while profits shot up 11.6% year-on-year to $3.6 billion.

What is worth noting is that it is not all bad news at Telecom Italia. This is a company which is under extraordinary pressure because of a truly unforeseeable event, but previous initiatives to create a healthier and more sustainable business are seemingly working. Improvement in cash generation (14% year-on-year increase) and debt reduction (down €923 million) have continued through the three-month period thanks to strategic initiatives launched in 2019. The underlying business model and strategy is still theoretically sound.

One of these projects, the network sharing agreement with INWIT and Vodafone, and subsequent sale of a stake in the towers joint venture, contributed €650 million to the debt reduction mission. Negotiations with KKR, for the sale of a minority share of the secondary fibre network, are continuing which will also reduce debt. It is not necessarily perfect scenario to be offloading assets, but needs must occasionally when pressure mounts on the spreadsheets.

It might be tempting to look at the surface figures, but it is always important to remember that COVID-19 is creating trading conditions no-one could foresee. TIM is still a business which is under threat from a highly competitive landscape in Italy, but the reaction from the team still looks competent.

Looking at the non-financial performance data, TIM Vision, the content platform saw a 20% increase in active users across the period, though mobile subscriptions dropped 579,000 year-on-year. IOT connections slightly compensated, but not enough. In fixed broadband, net customer losses across both consumer and wholesale totalled 233,000. It is clear the business is still adjusting to the new market dynamic with Iliad on the scene.

Segment Subscriptions Year-on-year
TIM Vision (TV) 1.85 million 21%
Mobile 20.42 million -2.8%
Fixed (retail) 8.98 million -1.5%
Fixed (wholesale) 8.01 million -0.6%

Sunrise and Salt supply strategic support to scupper Swisscom

Sibilant Swiss service providers Sunrise and Salt are forming a strategic partnership for the rollout of fibre across the country.

It will take the form of a joint venture called Swiss Open Fiber, in which they will have an equal shareholding and may get equity partners involved too. The aim is to drop CHF 3 billion on fibering-up 1.5 million Swiss homes (chalets?) over the next seven years. While Sunrise and Iliad-owned Salt will be the ‘anchor tenants’ other retail operators can lease the lines too, if they fancy it.

“We are excited to embark on this joint venture which will accelerate ultrafast broadband connectivity and significantly improve fiber penetration in Switzerland relative to other European countries,” said André Krause, CEO of Sunrise. “This platform is open and transparent to the market and we are extremely happy to have secured Marc Furrer, the most distinguished expert in the domestic market, to chair Swiss Open Fiber.”

“In 2008 we initiated the round-table, with which we achieved FTTH-deployment to around one third of the Swiss population,” said Furrer. “Now we want that the rest of Switzerland can benefit from high-quality FTTH-products, which are essential for home-office, home-schooling and home entertainment. The planned Joint Venture will bring this high-speed connectivity to most of the remaining market while ensuring infrastructure competition.”

“This project is unique of its kind, leveraging the capabilities and reach of two strong Swiss operators to create a nationwide infrastructure,” said Pascal Grieder, CEO of Salt. “Growing importance of flexible and virtual working and learning models will continue to drive the need for high-performance broadband services across Swiss households, and our initiative will facilitate such services at attractive prices. We have an ambitious roll-out plan and encourage municipalities and utilities looking into FTTH deployment to reach out to us. We are open for business.”

This move gives the two companies a better chance of competing with Swisscom, which is the dominant ISP in the country. For that reason there should be no resistance from Swiss competition authorities. On top of that is also creates more competition in the leased market and gives private equity a chance to get involves, so this looks like good news for everyone except Swisscom.

Jio carves out space for yet another US investor

It seems the US moneymen have a taste for Indian connectivity as General Atlantic becomes the fourth third-party firm to invest in the money-making machine which is Jio Platforms.

New York-based private equity firm General Atlantic has become the latest company to write a handsome $860 million cheque as table stakes for a 1.34% stake in Reliance Industries’ digital venture. Reliance Jio Platforms is looking like a very popular focal point for US investors attempting to tap into the rapidly developing Indian digital ecosystem.

In a matter of four weeks, Reliance Industries has managed to convince Facebook, Silver Lake, Vista Equity Partners and General Atlantic to part with almost $9 billion.

“I am thrilled to welcome General Atlantic, a marquee global investor, as a valued partner,” said Mukesh Ambani, Chairman of Reliance Industries. “I have known General Atlantic for several decades and greatly admired it for its belief in India’s growth potential.

“General Atlantic shares our vision of a Digital Society for India and strongly believes in the transformative power of digitization in enriching the lives of 1.3 billion Indians. We are excited to leverage General Atlantic’s proven global expertise and strategic insights across 40 years of technology investing for the benefit of Jio.”

While such warm words are usually offered irrelevant as to who the new investor is, General Atlantic is a useful company to have looped into the equation.

In the existing investment portfolio is NoBroker.com, an Indian consumer-to-consumer real estate transaction platform, Doctolib, digital healthcare platform in Europe to connect health professionals and patients, and Quizlet, an online learning platform. This is a company which has experience in the technology world, but also a number of bets which would be very complementary for the existing ventures in Reliance Jio Platforms.

“As long-term backers of global technology leaders and visionary entrepreneurs, we could not be more excited about investing in Jio,” said Bill Ford, CEO of General Atlantic.

“We share Mukesh’s conviction that digital connectivity has the potential to significantly accelerate the Indian economy and drive growth across the country. General Atlantic has a long track record working alongside founders to scale disruptive businesses, as Jio is doing at the forefront of the digital revolution in India.”

To call Jio disruptive is somewhat of an understatement, and the business model does seem to be drawing more attention from some very interesting organisations around the world. With the telco business unit as the tip of the spear, there is a clear opportunity to drive forward a secondary wave of digital businesses as connectivity get democratised through the country.

Doctolib, one of General Atlantic’s investments, is a very interesting platform for a country where traditional healthcare infrastructure is sporadic. The Jio digital ecosystem could act as a springboard for the app in the market, while Jio is then invested in another venture. Its collaboration and differentiation.

Reliance Jio, the telecoms business, is a powerful force, but the most interesting ideas are the ventures emerging today. The businesses which are enabled by the connectivity revolution which is sweeping the country. This is why the likes of General Atlantic are interested in invested in Reliance Jio Platforms now, not two years ago; the vision is much bigger than phone calls and streaming cat videos.


Telecoms.com Daily Poll:

Do you feel the US Government is justified in its action against Huawei?

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