Jio eyes deal with local firm to make handsets

NEW DELHI: With an eye on entering mobile manufacturing, Reliance Industries may acquire United Telelinks or forge a contract-manufacturing deal, sources said. Questions sent to Reliance Industries remained unanswered.

Jio Platforms, the telecom and technology arm of Reliance Industries, has received funding from top global private equity and internet giants, including Facebook and Google.

Sources said with Jio attaining leadership in the telecom space, Jio Platforms — the holding company for Reliance Jio — now wants to even control/offer a bundled eco-system to existing and new subscribers to help them migrate to affordable 4G smartphones. This is in line with Mukesh Ambani’s call to make 2G “history” in the country, a statement that would involve upgrading millions of subscribers (mainly from Airtel and Vodafone Idea) to the smartphone eco-system.

Speaking at the 43rd AGM of RIL a few months back, Ambani had announced new frontiers of expansion in the digital and telecom space where he spoke of ambitious plans in the lucrative handset market. He said Jio was targeting 500 million mobile customers by 2023, promising to bring out highly-affordable 4G and even 5G devices that would run on Android operating system provided by the new partner, Google.

“… there are many feature phone users who are waiting… to upgrade to a conventional smartphone… if only it were somehow more affordable. So, we have decided to address this challenge head-on. We believe we can design entry-level 4G… or even 5G smartphones… for a fraction of its current cost,” he had said, adding that it would be developed in partnership with Google.

Reliance sold bundled devices even earlier, but the production of those was outsourced to various contract manufacturers, including Flex.

The government’s PLI benefit scheme to boost smartphone manufacturing in India is almost finalised. A total of seven homegrown companies and five international players are in line to receive benefits under the programme.

The local companies include two each from the Lava group (Lava and Sojo), Dixon Technologies (Dixon and Padget Electronics), apart from single applications by Bhagwati (Micromax), Optiemus Infra and United Telelinks.

International players include top contract manufacturers of American electronics giant Apple (Foxconn, Hon Hai, Rising Star, Wistron and Pegatron), apart from Korean Samsung.

The entry of Reliance in the business with bundled mobile and data plans would put pressure on Chinese and local handset companies, especially those in the entry-level space.

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