Google invests $1 billion in Airtel: what the deal entails, the companies’ strategic goals

What does the deal with Airtel entail?

Google said it intends to invest up to $1 billion as part of its Google for India Digitization Fund, which includes equity investment as well as a corpus for potential commercial agreements, to be identified and agreed on mutually agreeable terms over the course of five years. This will comprise the $700 million equity investment in Bharti Airtel at a price per share of Rs 734 (the scrip opened trading on Friday at Rs 718 on the BSE), and up to $300 million that will go towards implementing commercial agreements.

What do these commercial agreements include?

According to a statement, as a part of its first commercial agreement, Airtel and Google will work together to build on Airtel’s extensive offerings that covers a range of Android-enabled devices to consumers via innovative affordability programmes. The companies will also work to explore further opportunities to bring down the barriers of owning a smartphone across a range of price points, in partnership with various device manufacturers. Notably, Jio, in partnership with Google last year, launched an affordable 4G device.

Are Google and Airtel also working on 5G?

Airtel is already using Google’s 5G-ready Evolved Packet Core & Software Defined Network platforms, and plans to explore scaling up the deployment of Google’s network virtualisation solutions to deliver a “superior network experience” to their customers.

Under the larger strategic goals of the partnership, both companies will also potentially co-create India-specific network domain use cases for 5G and other standards, with cutting-edge implementations, the statement said, adding that both Airtel and Google will also focus on shaping and growing the cloud ecosystem in India.

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