DNA Money Edit: Can RIL do a RJio in e-commerce?

The new foreign direct investment (FDI) in e-commerce policy in India shocked Jeff Bezos-promoted Amazon India and Walmart-owned Flipkart. The so-called e-marketplace operators went into a tizzy to make adjustments and restructure their respective operations to comply with the new guidelines.

Prepping on the sidelines is Reliance Industries Ltd (RIL) that has been waiting for the regulatory environment to turn in its favour by putting restrictions on deep-discounting, cash backs, exclusive deals, etc, by FDI-backed e-market players. Going aggressive over the last couple of months, RIL has been readying its e-commerce vertical while simultaneously acquiring stakes in a bunch of allied companies through its investment arm to support the venture.

With each passing day, RIL's e-commerce plans – getting shared unofficially – are only getting louder. Excitement in the market is being created through reports about pilot runs to getting neighbourhood mom-and-pop stores online via specialised point of sale (PoS) equipment, Reliance Jio mobile network and 4G handsets.

The trader community, while applauding the government's move curb Amazon and Flipkart's dominating position, continues to be concerned though. That's because RIL's e-commerce venture will now have a free hand to adopt strategies to lure neighbourhood stores on it platform and eventually create a dominating – something the trader community has been dreading for a while now.

Having already disrupted the telecom space in India, RIL could very well be looking to replicate the strategy in the e-commerce space as well. The extent of the disruption this time could be far-reaching though.