Google is considering investing in Vodafone Idea, the struggling Indian communications operator, in a possible bid to compete with Facebook for the Indian mobile market. Vodafone Idea, a partnership between British telecoms company Vodafone and Indian multinational group Aditya Birla, has been in serious financial strain.
Google is considering buying about 5 per cent of Vodafone Idea, according to a person familiar with the matter, while another said the talks were still at a very early stage, the Financial Times reported on May 28.
A month ago, on April 21st, Facebook announced a $5.7bn purchase of a 9.99 per cent stake in Jio Platforms, India’s largest communications operator. The deal is Facebook’s biggest outing since it bought WhatsApp for $22 billion in 2014.
With more than 388 million subscribers, Jio is owned by Reliance Industries, a conglomerate controlled by India’s richest man, Mukesh Ambani. Jio has received more than $10bn in investments in recent weeks from Facebook and private-equity giants including KKR, PanAtlantic Capital Partners, Vista Equity Partners and Silver Lake.
Alphabet, Google’s parent company, is also in talks to buy a stake in Jio, but has fallen behind rival Facebook in striking a deal, the Financial Times reported. The acquisition of Vodafone Idea could allow Google and Facebook to go to war in India’s mobile market.
Google has long been ambitious for the Indian market. To promote the popularity of its Android system in India, Google has launched a customized version of Android for emerging markets. Google’s mobile payment service has grown rapidly since its launch in India in 2017 and has become one of the most popular products in India on this crowded circuit.
Google, Vodafone, Aditya Birla and Vodafone Idea declined to comment on potential deals.