[HN Gopher] To Understand Jio, You Need to Understand Reliance
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To Understand Jio, You Need to Understand Reliance
Author : simonpure
Score : 121 points
Date : 2020-07-31 13:12 UTC (9 hours ago)
(HTM) web link (diff.substack.com)
(TXT) w3m dump (diff.substack.com)
| agustamir wrote:
| > That JIO has designed and developed a complete 5G solution from
| scratch
|
| Is that really true, or just some marketing hogwash? If true,
| then why is Jio not building a Huawei and helping install 5G all
| over the world? From what I know, very few companies have the
| technology to build 5G infrastructure.
| kolencherry wrote:
| Somewhat. It sounds like they have designed some of their own
| hardware [0] and they're working on building their own IMS
| stack [1]. I think Samsung is still their radio vendor.
|
| [0]
| https://economictimes.indiatimes.com/industry/telecom/teleco...
|
| [1]
| https://telecom.economictimes.indiatimes.com/news/reliance-j...
| achow wrote:
| This is couple of years in making. In 2018 Reliance acquired
| Radisys for building 5G solutions.
|
| https://www.zdnet.com/article/reliance-acquires-radisys-for-...
| hellomyguys wrote:
| >Is that really true, or just some marketing hogwash? If true,
| then why is Jio not building a Huawei and helping install 5G
| all over the world?
|
| I think that's an explicitly stated goal from their annual
| general meeting.
| praveen9920 wrote:
| Almost every company claiming to have 5G solution has their own
| definition of 5G and some solution. Can it be deployed in
| scale? That is questionable.
| fareesh wrote:
| If India is Detroit in the Robocop universe, Reliance is OCP.
| mangamadaiyan wrote:
| Oh, for an Alex Murphy.
| techfoolery wrote:
| Agreed with the premise of title. I think Vedica Kant does a more
| comprehensive job laying out where Reliance comes from & how it
| was shaped in her substack newsletter two-parter:
|
| https://hind.substack.com/p/reliance-origins
|
| https://hind.substack.com/p/from-oil-to-jio
| samdung wrote:
| For those looking for the banned book "The Polyester Prince: The
| Rise of Dhirubhai Ambani" ... here's the link to donwload:
| https://www.dropbox.com/s/e1kdqqnqpl9uhfv/The-Polyester-Prin...
| [deleted]
| pm90 wrote:
| Its a very good read. The family is lauded as heroic for their
| meteoric rise. The amount of cheating and bribing that they did
| to get there doesn't get that much attention. And to be clear,
| in a system where the laws are selectively applied, that might
| be the only path to business success, and they were able to
| exploit it to the max.
| pankajdoharey wrote:
| The book doesnt seem to be banned
| https://www.amazon.in/Polyester-Prince-rise-Dhirubhai-Ambani...
|
| What you are posting is a pirated copy.
| searchableguy wrote:
| https://en.wikipedia.org/wiki/The_Polyester_Prince
|
| Wikipedia shows it was banned from _being published in
| india_. Interestingly, the citations are pointing to a 404
| page. From bit of googling, I can find post from wire [0].
|
| Interesting edit: https://en.wikipedia.org/w/index.php?title=
| The_Polyester_Pri...
|
| Btw, you can find listing of many banned items on amazon.
| That doesn't mean they are not banned or illegal. Plus, it
| seems that book is from international sources because 30k is
| a huge amount in India. That's more than the average salary
| here monthly.
|
| 0] https://thewire.in/books/the-unhappy-prince-how-dhirubhai-
| am...
| heimatau wrote:
| The article mentions that it was banned [1] and links to this
| [2].
|
| [1] - "...The Polyester Prince, a book with enough
| entertaining anecdotes about Ambani's business career that he
| got it banned after publication."
|
| [2] - https://www.hindustantimes.com/india/pirates-bring-
| ambani-bo...
| areoform wrote:
| > Reliance's timing was uncanny: when tariffs went up, Reliance
| happened to have stockpiled the goods in question; when their
| inventories ran down, tariffs dropped. It's unclear when the
| system switched from Reliance knowing what the government would
| do to Reliance deciding what the government would do, but clearly
| at the peak of their power they were able to call the shots.
|
| > As a public company, Reliance engaged in some novel financial
| engineering--issuing convertible bonds with ambiguous conversion
| terms, exploiting those terms to get cash when necessary, and at
| one point cornering the market in their own stock. Perhaps the
| high point of Reliance's financial engineering was in 1986, when
| the company publicly stated that earnings would rise, then found
| that earnings weren't rising after all. The solution: an 18-month
| fiscal year. Record profits secured.
|
| > Jio's fundraise was opportunistic in two directions: Reliance
| wanted to delever, and outside investors wanted access to India's
| market. It's not a coincidence that this fundraising occurred at
| the same time that tensions with China erupted; a country that
| can ban TikTok and restrict Chinese investments can do the same
| to other countries, too. And, of course, it helps that Jio is
| getting more liquidity at the same time that its competitors
| mysteriously found themselves on the hook for giant fines.
|
| For clarity's sake, usually bribery, securities fraud, money
| laundering, revenue recognition fraud and other demonstrably
| fraudulent activities gets you put in jail. Not lauded as being
| clever.
|
| If the investments put in by Facebook and Google are used to
| manipulate the local political environment, does this mean that
| they're on the hook for liability via 15 U.S.C. SS 78dd-1, et
| seq.? Or, the Foreign Corrupt Practices Act? Do the firms have
| liability, or are they shielded via virtue of the "investment"?
|
| -
|
| Some Google searches later, one of their executives, presumably a
| family member, tried to get someone killed by calling in the mob,
| https://www.indiatoday.in/magazine/cover-story/story/1989083...
|
| https://www.economist.com/leaders/2014/08/02/an-unloved-bill...
|
| Their history is hard to believe and harder to square away. Will
| this lower FB and G's liability shield? Any thorough due
| diligence should easily uncover more in this wretched hive of
| scum and villainy.
| rajekas wrote:
| A little bit more Googling will tell you that Kirti Ambani, the
| man accused of ordering the hit, was no relative of Dhirubai,
| the Godfather.
|
| Nusli Wadia, the man he was supposedly getting killed, is the
| head of an important textile firm himself and the grandson of
| the founder of Pakistan.
|
| The scandal of which this episode is but one battle, led to the
| downfall of Rajiv Gandhi's government and triggered the long
| downfall of the Congress party, which is how Dhirubai's son
| Mukesh finds himself so close to the current regime whose
| predecessors, ironically, benefited enormously from the alleged
| chumminess between the father Ambani and Rajiv.
|
| Wretched hive of scum and villainy seems a bit overwrought
| though; par for the course for robber barons and way less
| scummy and violent than Andrew Carnegie or Cecil Rhodes and
| other titans of western industry.
|
| Plus they haven't caused coups in Central American countries.
| Yet. Though I wouldn't mind if Mukesh bhai bought England and
| replaced the Union Jack with the Tricolour.
| pankajdoharey wrote:
| > Though I wouldn't mind if Mukesh bhai bought England and
| replaced the Union Jack with the Tricolour.
|
| I dont think he has enough buck in the bank to buy an entire
| country.
| techie128 wrote:
| > I dont think he has enough buck in the bank to buy an
| entire country.
|
| give it some time
| searchableguy wrote:
| He has enough to buy politicians.
| michaelyoshika wrote:
| tl;dr: a monopoly with deep ties to government.
| reactspa wrote:
| This article delivers a very good understanding of what it's like
| to be an entrepreneur in India. Kudos.
|
| One of the coolest things I've read about Jio is something I read
| on a previous post on HN: that the name and logo were designed to
| be the mirror image of oiL.
|
| > Later, Reliance profited from other parts of India's
| protectionist regime. Their synthetic fiber arbitrage worked like
| this: to make manufacturers self-sufficient, the Indian
| government allowed them to import raw materials only in
| proportion to the goods they exported. Ambani persuaded the
| government to let him import polyester filament yarn in
| proportion to the nylon goods he exported. Nylon was available
| cheaply in India, polyester filament was 600% more expensive when
| locally sourced in India than its cost when imported. So Ambani
| set up a closed loop: make nylon clothes from locally-sourced
| materials; sell them abroad; use the import quota to import
| polyester filament; sell it at home. And, just to be safe, he
| took care of the demand side, too: at least according to The
| Polyester Prince, Ambani sent money abroad to buy his own
| products at duty-free ports, and then sold them for cheap, gave
| them away, or even dumped them in the ocean.
|
| All true except in many cases, the exporters didn't need to
| actually export anything. If the right bribes were paid (Congress
| Party's modus operandi), it was all a "receipts game"... you just
| needed receipts that "proved" that you had sent goods abroad,
| that money had hit the bank, etc.
|
| There was a huge fertilizer subsidies scam in India a couple
| decades ago which was another case of "receipts game". (The scam
| involved subsidies [given by the government] for using fertilizer
| [similar to Agricultural Subsidies in the USA]. Turns out that
| most of the subsidies were going to politicians who weren't using
| any fertilizer, they were just providing the correct receipts
| that "proved" that they had bought -- and presumably used --
| fertilizer.)
|
| Finally, I worked at a bank in India for a short while, just
| after the major devaluation of the currency in the nineties (the
| Indian Rupee was devalued by over 50% in two phases). Around
| midnight, the day before the surprise announcement by the Reserve
| Bank of India (and the Government of India), a bunch of treasury
| operations staff at the bank got marching orders to go to the
| office and sell off, as much as they could, the Indian Rupee, and
| buy foreign currencies. They worked all night. The client made
| millions from this bank's operations alone. The client? Reliance.
| pankajdoharey wrote:
| India is a tough market with overregulation and corruption as
| the article points out. Being an Entrepreneur must be hard in
| India.
| searchableguy wrote:
| Yeah. Increasing number of entrepreneurs here prefer to
| incorporate and operate their companies in other countries
| and sell there.
| raghava wrote:
| Jeff Bezos himself isn't spared from Jio tax[1], what chance
| does a measly entrepreneur stand against Ambani and Jio!
|
| [1]https://techcrunch.com/2020/07/23/amazon-reportedly-in-
| talks...
| puranjay wrote:
| It's an open secret in the Indian bureaucratic establishment
| that Reliance will hire retiring bureaucrats and get them to
| work their networks to find out what's happening in the
| government before it actually happens.
|
| I don't even blame Reliance. These were the cards they were
| dealt with. They just knew how to play them better than anyone
| else.
| gramakri wrote:
| Speaking of scams, my favorite is the fodder scam -
| https://en.wikipedia.org/wiki/Fodder_Scam . Large amounts of
| receipts and paperwork for fodder, sheds, farms, cattles...
| none of which existed. It was all an epic work of fiction!
| ra7 wrote:
| In recent memory, another favorite is the 2G spectrum scam -
| https://en.wikipedia.org/wiki/2G_spectrum_case. The Telecom
| minister taking bribes and bending rules to grant licenses to
| his favorite companies, the Prime Minister unable to control
| his own minister and letting the scam occur, the propagation
| of "zero loss" theory. It was very... entertaining to see
| corruption exposed at the highest level in the government.
| EHEFctspyh wrote:
| From the 2G spectrum scam wiki page you shared
|
| "....On 21 December 2017, the special court in New Delhi
| acquitted all accused in the 2G spectrum case including
| prime accused A Raja and Kanimozhi.[12] This verdict was
| based on the fact that CBI could not find any evidence
| against the accused in those 7 years. As per the judgement,
| "Some people created a scam by artfully arranging a few
| selected facts and exaggerating things beyond recognition
| to astronomical levels..."
|
| I am not sure what to make of this, more so considering
| that this happened when the opposing party, BJP, was in
| power. - Was there no scam at all? Was there a scam but
| they just accused the wrong people? Is the judiciary and/or
| CBI complicit? And, if so is BJP complicit too, because
| ideally they should have every incentive to ensure the rule
| of law is enforced to the fullest degree considering that
| the accused were from the opposition Congress party?
| signal11 wrote:
| > Was there no scam at all?
|
| Mihir Sharma's book _Restart_ (2014) has a good chapter
| on this. The answer it seems was, no.
|
| It's not in the national interest to charge maximal
| prices for natural resources, and this is followed by
| many countries even today -- China and the US included --
| and such rights are given away for a nominal or modest
| price, and always with a view to ensuring wide market
| participation.
|
| Even European spectrum auctions have a clear aim of
| ensuring a sustainable market of 4 or more effective
| competitors.
|
| This has been historic practice in India also. For
| instance, the British colonial government gave India's
| other big industrial group -- the Tatas -- rights to coal
| and iron mining in the late 1800s _for free_ to set up
| India's first steel plant. Even the BJP's own Vajpayee
| government did this.
|
| The CAG's "notional loss theory", he argues, is rubbish.
| And looking at the events in India's once vibrant Mobile
| Telecom industry, which has has now been reduced to an
| effective duopoly, one can argue Sharma was right.
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