A budget-friendly smartphone, with a price tag of Rs 6,500 (US$80), is turning out to be a source of great frustration for India’s telecom giant, Reliance Jio Infocomm, and US tech titan Google*. The price of JioPhone Next, a flagship product of their strategic alliance, was slashed by 40% within six months of its launch in October 2021—thanks to lacklustre sales.
Reliance Jio has only managed to sell ~2 million units of this entry-level 4G device so far, The Ken has learnt. This doesn’t augur well for Google’s US$4.5 billion investment in Jio Platforms, the telco’s parent and a unit of billionaire Mukesh Ambani-owned Reliance Industries Ltd (RIL), India’s most valuable company, in July 2020.
At the time of the launch, media reports suggested suggested Disruptive Asia Jio aims to sell 50 million JioPhone Next 4G smartphones in six months Read more that Jio’s aim was to sell 50 million devices in six months. Google executives were a lot more realistic in their expectations. They believed that Reliance Jio would sell at least 20 million handsets in a year, at least two people close to the internet giant told The Ken.
A telecom colossus and a tech major with seemingly unlimited resources collaborating to bring an entry-level phone for half a billion people. Sounds like a match made in heaven. So why isn’t it?
For one, the Google and Jio teams couldn’t agree on specifications for the smartphone, a former Google executive said. Google expected the smartphones to be priced cheaper, they added. Moreover, the teams came from very different setups: while Google has a relatively more democratic work culture, Jio takes a more top-down approach to decision-making. Also, the teams met only over video calls through most of 2020 and 2021.
The partnership had much riding on the JioPhone Next. So much so that the Mountain View, California-headquartered company set up a separate team of engineers and product managers to help Jio with a tweaked version of Android, branded as PragatiOS at Jio’s behest.
The team, internally codenamed Namaste, comprised 30-40 engineers reporting to Ram Papatla, general manager and India engineering lead at Google India.
But several executives of the Namaste team have either been reassigned within Google or quit, two persons close to the company told The Ken. These include two senior-level exits: Arun Rajappa, director of product management, and Shyam Ramamurthy, director of Android engineering. Both reported to Papatla.
Now, the partnership—at least for smartphones—is in limbo.
