Even though Google has invested much lesser in Bharti Airtel as compared to Reliance Jio, the former will be able to give a strong competition to Reliance Jio’s affordable 4G device namely ‘JioPhoneNext’, said ICICI Securities in a note.
The purpose of Google’s investment in both Jio and Airtel is different. With Airtel, the partnership with the search engine giant will focus on these key areas: 1) making the 4G devices more affordable through subsidies and not manufacturing own devices like Jio; 2) network use-cases with a heavy focus on 5G, and 3) Cloud infrastructure and services.
It is not just Airtel that’s going to benefit, but even Google will be able to penetrate the telco’s strong mobile subscriber base along with SMEs (small and medium-sized enterprises), believes ICICI Securities.
Huge Opportunity for Telcos in the SME Segment
The analyst said that there’s a huge untapped opportunity in the SME segment as more businesses shift to digital platforms. Bharti Airtel already has multiple offerings for SMEs. It is worth noting that the telco already offers G-Suite, a product bundle from Google for professionals and small businesses.
Since now Google has an equity stake of 1.28% in the company, the search-engine giant will help Airtel in aggressively pushing its products, said ICICI Securities.
Google will also benefit from the growing data centre business of Bharti Airtel. For the unaware, Airtel operates its data centre business under the brand ‘Nxtra by Airtel.’ The partnership will directly affect the Indians as both the companies will look to make 4G smartphones more affordable for the customers and increase digital adoption in the country.
During the previous week, Google announced that it will be investing over a USD billion into Bharti Airtel and will acquire a 1.28% stake in the company for $700 million while the remaining $300 million will be utilised for forming multi-year deals that will focus on developing the above-mentioned things.