Google is investing up to $1 billion in Bharti Airtel as part of its Google for India Digitisation Fund.
The deal includes an investment of $700 million to acquire a 1.28% ownership in the Indian telco and up to $300 million towards mutually agreed multi-year commercial agreements over the course of the next five years.
As part of the first commercial agreement under the deal, the companies will work to scale Airtel’s offerings that cover a range of devices through affordability programmes. In the long term, both companies also plan to co-create India-specific network domain use cases for 5G and other standards, and focus on shaping and growing the cloud ecosystem in India by helping to accelerate digital transformation.
Google also said it’s looking to create new business models to help grow the Android OEM ecosystem in India with Airtel, but didn’t specify what kind of models these would be.
It also highlighted that it has made steady progress on the goals it set out to achieve with its Google for India Digitisation Fund, including building an India-focused Android experience and partnering with companies that build localised content experiences.
“Airtel is a leading pioneer shaping India’s digital future, and we are proud to partner on a shared vision for expanding connectivity and ensuring equitable access to the Internet for more Indians,” said Sundar Pichai, CEO of Google and Alphabet. “Our commercial and equity investment in Airtel is a continuation of our Google for India Digitization Fund's efforts to increase access to smartphones, enhance connectivity to support new business models, and help companies on their digital transformation journey.”
Airtel has around 30.43% market share of wireless subscribers in India as of 30 November, 2021, according to the Telecom Regulatory Authority of India. Reliance Jio leads the market with a 36.71% share, while Vodafone Idea has 22.88%.
Google outlined in 2020 that it would invest $10 billion in India over the following five to seven years through its India Digitisation Fund. The company is set to invest it through a mix of equity investments, partnerships, operations, infrastructure, and ecosystem investments.
Google said its goal was to make the Internet helpful for 1.3 billion Indians and help power the country’s economic engine.
Google, however, isn’t the only tech firm that has invested in Indian telcos, as in July 2020 Intel invested $253.5 million in Jio platforms, the country’s biggest telco, through its Intel Capital investment arm. The deal gave it a 0.39% stake in Jio.
Three months earlier, Facebook also invested $5.7 billion in Jio, as the telco’s owner Mukesh Ambani was selling off 20-25% of the company to raise money for its debt-ridden parent company, Reliance Industries.
