IN THE end it was even worse than they had feared. For months now, India’s dozen mobile-phone operators have been pondering just how aggressively Mukesh Ambani, the boss of Reliance Industries and India’s richest man, would gatecrash their market with the launch of Jio, his new 4G telecoms operation. They certainly expected the thousands of billboards adorned by Shah Rukh Khan, a ubiquitous Bollywood star. Heavily discounted prices were predictable, too. But the news that, from September 5th, anyone paying as little as 149 rupees ($2.20) a month would be able to make free phone calls and browse the internet a bit was a genuine shock. The share prices of rival firms tumbled.
Telecoms incumbents are right to worry. Reliance has been able to use billions in cash from its main oil and refining businesses to invest over $20 billion in the infrastructure required to deliver high-speed connectivity across India. And Mr Ambani understands the industry extremely well. He built a network from scratch in the early 2000s, although that firm eventually went to his younger brother, Anil, in 2005 after the pair…Continue reading