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Mukesh Ambani, Sunil Mittal at India Mobile Congress: Photo-op or genuine thaw?

LiveMint logoLiveMint 27-09-2017 Amrit Raj

New Delhi: They met, they greeted each other as if they were long-lost friends, they smiled for the cameras. Were these the chairmen of two companies engaged in a no-holds barred fight over the last year?

On stage together for the first India Mobile Congress, Mukesh Ambani, chairman of the Reliance Industries Ltd-owned Reliance Jio and Sunil Mittal, chairman of Bharti Airtel Ltd, temporarily dropped their adversarial stance for a rare show of camaraderie calling each other “friends” and vowing to collaborate and promote technologies such as artificial intelligence, robotics, Internet of Things, cloud computing, technologies which Ambani called “enablers of a new wave of wealth and employment for all”.

Forgotten briefly was the battle of the two giants dating back to 2002 when Ambani launched Reliance Infocomm in competition with Bharti Airtel. Having resumed hostilities last year after a 10-year hiatus, Ambani said: “We have to invest in building next-generation technology assets. We have to root out inefficiencies across the digital ecosystem. And we must break silos and forge partnerships. No single corporate, nor the government, can do it alone. Together, we can achieve the unimaginable.”

It was a significant statement since it came after a closed-door meeting with Mittal and telecom minister Manoj Sinha.

Mittal was equally pacifist: “As Mukesh pointed out, none of us can do it alone. We will all have to come together for the benefits of customers. We have to collaborate ourselves, create an ecosystem, use common towers, hopefully common fibres.... We will need to combine the forces with the government. I hope, together with friends like Mukesh, we will build something for the future.”

Bharti Airtel is locked in a fierce turf war with Reliance Jio, which has sought to disrupt the market leader’s dominance through a series of ultra-cheap services and now affordable handsets. The companies have also sparred over the so-called IUC, or interconnection usage charges, levied by a telecom firm for terminating a call from another telecom (the second firm pays). Last week, the telecom regulator cut the charge in a move that benefits Reliance Jio and disadvantages older telecom firms such as Airtel. Reliance Jio has also argued against a relief of bailout package for the telecom sector that is being considered by the government.

Ambani chose to sidestep the regulatory battle the two companies are engaged in altogether and said that the Indian mobile market is now overflowing with data and the industry has worked to “create a robust digital circulatory system” to carry data to each one of 1.3 billion Indians.

Still, it’s a system in considerable distress on account of Reliance Jio’s aggressive moves in the market and it remains to be seen if Mittal and Ambani meant what they said.

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