Mukesh Ambani’s broadband plan? 'Kar lo duniya mutthi mein'-II

In the Information Age, he who owns the bandwidth owns the game. Nobody knows this better than Mukesh Ambani.
And own he does, 20 megahertz of it, for fourth-generation broadband rollout.

Now, if you are Mukesh Ambani, history shows you tend to think huge, years ahead, and then connect the dots.

The attempt here is not to be Mukesh’s hagiographer; there’s enough empirical evidence of very large-scale execution achievement.

So what’s the broadband mega picture Mukesh has drawn?
One can only indulge in some logical guesswork. First of which is that Mukesh rolls out broadband services for folks like you, me and companies, or ‘the subscribers’.

Now what are these services? It could be as varied as offering movies in hi-def, multiplayer platforms for online games on the fly, news and data services such as helping companies jigger hi-definition video-conferencing...

One thing that’s unlikely is a return to voice telephony because broadband licensing terms don’t allow it — only Universal Access Service Licence does.

And how would you avail of the services? Through mobile phones, iPad-like devices, laptops, or even the good ol’ desktops and television sets.

Chances are, more than 90% of the delivery will be on mobile phones on the consumer side. That’s the only way the lack of computer penetration in India, which is wallowing at around 5%, can be surmounted.

On the other hand, a substantial chunk of corporate use will be through computers.

Mukesh will offer much more. He will help you pay your bills, buy tickets of all kinds, order food from a restaurant, buy clothes by visually sampling them on your phone, facilitate tuitions, virtual classes ... all this using the ‘fat pipe’ — which is geek for broadband.

He will help companies manage their data by renting his infrastructure (in software, data mean many things, including financial numbers, attendance and salary slips, creating and zipping engineering designs ... all the work that companies do. Video is also data.)

All this, however, is the straight part. Mukesh on Friday said he also plans to exponentially grow his retail business, which now has a turnover of $1 billion, to $10 billion in five years.

What he didn’t say is growth will be far more exponential after
5 years if India grows at 8%-9% over the next decade, as it is
expected to. And when his broadband plugs into his retail business, he will also help you buy a lot of stuff online — practically 90% of what you will need in your daily/weekly/monthly life, using your mobile phone/iPad/PC.
    
In effect, he will take away business from the neighbourhood mom & pop kiranas, from the neighbourhood malls and supermarkets because, by making geography history, to borrow that all-time great copyline of the beleaguered Iridium satellite project.

By default, he will also lord over India’s largest logistics entity because large physical deliveries will have to be orchestrated using a massive supply chain.

By being with you literally 24x7, in hand, on your mobile, at home or anywhere, Mukesh will own you, the consumer.     

He will own you because he will become the King of Convenience, and you, me and everyone else loves convenience.

Who doesn’t want to order groceries sitting at home and have it delivered at the doorstep? Who doesn’t want the convenience of completing non-office chores from home, after a hard day’s work and travel?

If you are Mukesh, you will also do one more thing. You will own a payment gateway embedded in the fat pipe, to collect monies flowing from all those potential billions of personal and corporate transactions. That would essentially mean plugging in a non-banking finance entity or a transaction processing system like those used for credit cards (Reliance Credit Cards!) or even a bank (Reliance Bank!).

Now imagine scale.

On Friday, Mukesh said broadband penetration in India is just 1%. What does that tell you? Only 1.2 crore people have access to it in the country. That may be an overestimate.

Anyway. That also means 99%, or 118.8 crore people, don’t have broadband access, considering India’s estimated population of 120 crore. Get the picture of a gargantuan ecosystem?

One more thing: Mukesh would have paid over Rs 12,000 crore to get the spectrum for his broadband binge. Too much upfront expenditure? In reality, that may not even be a fraction of what he would earn over the next couple of decades — if things go well.
Considering the volume dimensions of the project, Mukesh would’t have to price anything steep, no matter the spectrum fees.

Bottom-of-pyramid affordability will more than suffice for telecom’s original price warrior. Remember Monsoon Hungama, circa 2003? Remember his plan then, of rolling all of the things described afore through optic fibre networks? Of Kar lo duniya mutthi mein?

This time round, he is doing the same wirelessly, using airwaves.
All this fantasising, of course, is predicated on the ability of technology to facilitate such an online empire.

On the bandwidth side, at 20 MHz of contiguous spectrum across the country, Mukesh’s got more than twice the 10 MHz that data rivals, the 3G telecom auction winners, have. To boot, they have the spectrum only in some circles, not nationally.

As of now, the technologies Mukesh is riding on — Wimax and Long Term Evolution — are not mass-tested on a scale they need to work in India. That’s the only mountain to climb.

Execution is a non-issue. It’s Mukesh’s middle name.