On May 28, 2020, Financial Times reported that Google is exploring a stake in Vodafone Idea Limited (VIL) to further its India presence. This news comes close on heels to the recent spate of investments in Jio Platforms, a wholly-owned subsidiary of Reliance Industries Limited.
We at Greyhound Research believe this could be a risky move for Google that has been working closely with the Bharti Airtel enterprise team for a few years now. Both have invested in training Bharti Airtel’s workforce to sell Google Suite to its enterprise customers. However, the relationship has been only reasonably successful and has failed to yield exponential returns for both.
Having said that, given the troubled state of affairs at VIL, Google may well end up with a sweet bargain which would be an impossible feat with Bharti Airtel. The company has known to be in a critical state since late 2019 given the need to pay additional statutory dues as per the court orders. The money coming into VIL via a stake sale to a strategic partner can go a long way in helping it tide over these uncertain times.
Also, recently VIL launched Cloud Express Connect wherein it extends private and secure MPLS network to Microsoft Azure and Google. This and other initiatives, including IoT and Enterprise Mobility, will allow Google to further exploit the synergies with VIL’s customer base.
Lastly, might be worthy to note that VIL, like Bharti Airtel and Jio Platforms, has aims to expand its business beyond Connectivity and into 5 other areas including Content, Community, Commerce, Currency and Capital. We at Greyhound Research term this as, “The 6C Digital Platform Matrix”.
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Analyst:
Sanchit Vir Gogia: Sanchit is the Chief Analyst, Founder & CEO of Greyhound Research, a Global, Award-Winning, Technology & Innovation Research & Advisory firm. To read more about him, click here.
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