The | The comparison
The $5.7 billion (Rs 43 crore) investment largely accounted for by Facebook in Jio Platforms, a subsidiary of Reliance Industries, India's most esteemed company, could be the subject of watchdog investigations. Indian antitrust. According to a Bloomberg report, the Competition Commission of India (CCI) is examining Facebook's purchase of 574% of the capital of Jio Platforms. The report, based on an email interview with Ashok Kumar Gupta, president of CCI, did not specify anything in particular about the Jio-Facebook deal. But Ashok Kumar was quoted as saying that existing CCI rules could be changed if necessary to investigate certain existing transactions. "Currently, some M&As are off the threshold of scrutiny, even if the potential harm is apparent," Ashok Kumar Gupta said. "Peculiarities such as 'strong network effects, high returns to scale and access to large amounts of data' can encourage digital companies to engage in anti-competitive behavior," he said, without referring to No Special Case. ITC is mandated to prevent misuse of data in all transactions it evaluates.
Data, the driver
The Facebook-Jio platform deal should be based on the data the big two have access to through their existing business operations. Jio Platforms has more than 388 million subscribers. Facebook, on the other hand, has 350 million users in India, while its WhatsApp messaging service has amassed more than 400 million users in India. WhatsApp is the most popular instant messaging service in the country. Without a doubt, data is by far the most important cornerstone of the deal with Jio and Facebook. The data will spur activity at Reliance's ambitious Jio Mart, recently launched in India, and would pull out of access provided by WhatsApp. WhatsApp has already been launched in the beta mode of WhatsApp Pay. Although its rollout in India has been delayed for a variety of reasons, once it becomes available to everyone, it is expected to be a game changer.
So far so good
Facebook, in its application to the ICC, had asserted that the settlement did not change the competitive landscape in any relevant markets. Facebook formed a separate subsidiary "Jaadhu Holdings" for the transaction, and in its filing with CCI said: "The proposed transaction and proposed business agreement are pro-competitive, benefiting consumers, Kirana stores (convenience stores) and other Indian micro-businesses. small and local, and advancing the vision of digital India." The alliance is also expected to help Reliance and Facebook tap into India's digital payment space, which is expected to grow fivefold to €1 trillion by 2023, and compete with PhonePe, Amazon Pay, Paytm and Google. Pay. . India, with its 1.300 billion people, is one of the world's fastest-growing online arenas, with big names like Amazon and Google vying for dominance. The CCI, for the record, studies Amazon and Walmart online services on exclusive deals between retailers and certain brands of mobile phones, and preferential treatment given to certain sellers. The general belief in the market is that the ICC chief's words are only of academic interest, and the scrutiny speech in the Jio-Facebook deal without any details is just a storm in a cup of tea. "Don't expect anything major," a source said. (Your one-stop guide to Jio Platforms and their investors is here.) Via: Bloomberg.