In June 2010, a little-known internet service provider called Infotel Broadband Services emerged as the sole pan-India winner in the auction broadband wireless access (BWA) paying Rs.12,850 crore for BWA spectrum in 22 circles. It was an auction that Vodafone walked away from citing high prices, Idea didn’t win a single bid and Bharti Airtel won just in four circles. Hours later, on the same day, Infotel announced that Reliance had picked up a 95% stake in the company. And just like that, in one swift move that clearly caught the industry on the wrong foot, Mukesh Ambani was back in the telecom game.
Soon after the acquisition, in one of the brainstorming sessions where he and his A-team were drawing up the blueprint for the telecom business, one of the team members asked, “If we can create a petroleum business out of pipes, why can’t we do that with telecom?” In fact, the brand name Jio is said to have evolved from the mirror image of oil. The idea was to push data through pipes making it easily accessible to the end consumer. Ambani knew there was very little juice left in voice with tariffs at an all-time low and demand turning inelastic. But a high-quality data offering could be a potential game changer.
That’s how Jio began its journey six years ago to turn the telecom industry on its head yet again. By making voice free, it has opened up a fascinating battle for the consumer’s wallet, marking a turning point in the industry’s two-decade old story. With growing concerns on how companies will recoup their investments, this has the making of a bloody war, sure to bruise many a player.
In December 2002, Ambani launched Reliance Infocomm’s services to a packed audience marking a defining moment in the industry. Subscribers didn’t have to pay for incoming calls and they had to pay just 40 paisa for making calls. For consumers who were paying at least three times more to make calls and were charged for receiving calls, Christmas had come early. When they discovered that the high costs of handsets still put mobile telephony out of reach for many consumers, Reliance came out with its Monsoon Hungama offer and made handsets available for jus