Why Is Intel’s Investment in Jio Significant for India’s Tech Future?


Investments abound for Mukesh Ambani as Intel Capital (part of the Intel Corporation) has invested Rs 1894.5 crore in Jio Platforms in exchange for a 0.39% stake in the company. The move shows Intel’s commitment to improving internet connectivity by focusing on 5G and the increase of their artificial intelligence output. Moreover, Jio will benefit from Intel’s cash injection for launching their laptop. But why is Jio such a lucrative investment – and what does it say about the telecoms market in India going forwards?

Bidding Conflict for Jio Platforms

The move by Intel was strategic, especially as April 2020 saw Mark Zuckerberg suggest that Facebook would invest $5.7 billion for a 9.9% stake. Indeed, Facebook own a lot of companies (notably not Spotify) either outright or in part. The tug of war for Jio represents not only the base of users in India but the prospects for the future, which look bright. A report discovered that Jio would claim more than half the entire Indian market for telecoms users, which would put them in a good place strategically. The report indicated that the current 388 million subscribers would become 500 million in 2023 and rise to 609 million by 2025. The large market share means a lot of data for the company – 500 million subscribers – which would be of interest to a company such as Intel Capital. As their attention has previously been on artificial intelligence, this data could help shape the AI of the future and position India as one of the world’s leading nations in the field.

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AI in India

2019 saw India increase its AI workforce by 100%, with 72,000 in AI positions in 2019 up from 40,000 in 2018. But talent shortages mean that many jobs are still vacant. If Intel and Jio are attempting to improve their AI capacities, an increase in talent and people specializing in the field are necessary. The revenues for the industry have also grown at similar rates, so pumping money into training and attracting foreign investment and job seekers could help the industry thrive even more. India is seeing a boom in start-ups that are focused specifically on AI. These include Staqu, which uses AI to deal with cyber-crime, Intello Labs, which provides agricultural solutions for industry, and Blue Sky Analytics, which uses AI for environmental data, capitalizing on it being real-time to tackle the issue of air pollution. When people look towards the latest tech developments, they are often checking for progress in the field of AI.

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Do We Want Quicker Web?

One of the developments will be faster internet through better deployment of 4G and 5G technologies. Ensuring that rural India and urban India have parity in terms of internet connection is a big focus of the digital outreach of the government. The latest figures indicate that rural India has overtaken urban India with 10% more internet users (227 million compared to 205 million). India therefore has the second largest internet population, which means telecoms companies are primed to create better solutions and attract customers from this pool of active users. Indeed, the need for better processing when it comes to mobile internet technology can be seen through the rise in how people engage with such technology. The internet connectivity and telecoms infrastructure need to keep up with the trends that show what people are doing on the internet.

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For example, in India, there were 340 million Facebook users at the start of 2020, which equates to almost 25% of the population. The growth in social media requires more connectivity to handle the people who will be spending time online. As this figure rises, so too will the need to provide a strong service for these people. Indeed, as what we can do with phones increases – as events such as Samsung Unpacked show us – so too will the need to be supported in this. Indeed, most of our entertainment today comes from the internet. Casino sites like Betway provide the ability to engage with high-tech concepts such as live poker, blackjack, and roulette requires a faster connection to ensure important aspects of the game aren’t missed. These games are becoming the norm for the industry, so connectivity needs to catch up. Moreover, increasing subscribers to streaming services such as Netflix in India has been part of that company’s mission as its domestic subscription has stalled. The Indian market has shown an appetite for streaming services, with an estimate showing that subs almost doubled between 2018 and 2019. If an increase relies on more people using Netflix on the move, strong internet is a necessity.

Investments are usually done for strategic purposes and the Intel and Jio investment is an example of this. While the stake in the company is small, the skillsets of both companies could work in tandem to deliver real change. The AI prospects and the growth of internet connection will lead to a more prosperous India and work towards the digital country that the government is striving for. China, Japan, and the USA are all vying to show their tech capacities for AI, but India looks to be using their unique position to be able to pip them to the post to reign supreme in the future.

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