I wish I were 30 years old today: Mukesh Ambani

It has taken nearly six years and Rs 1,50,000 crore to give shape to Mukesh Ambani’s most ‘audacious’ ambition. The Reliance chairman and India’s richest man sat with TOI’s Pankaj Doval, Boby Kurian and Vikas Singh for almost two hours to talk about his massive bet on the future of India. Excerpts:Q. Ever since you had to let go of telecom in the family split of 2005 there was a sense that you will return to this business with something better and bigger. Would you call Jio a magnificent obsession of yours? After all you could’ve done something else which was equally big. Why telecom?

A: I am a big believer that whatever has gone, lies in the past. You should only learn from it, and you should only look at the present and the future. That’s been my father’s philosophy and mine as well.

I have always believed that technology drives human civilization’s endeavour and progress. So if you ask what is my obsession, it is technology. In the 1970s it was technology in chemical engineering– the whole question of building Reliance from a textile company to an energy major. We were the biggest in textiles in the 1970s. Everybody expected me to study textiles. I wanted to pursue chemical engineering, because I thought it was the future.

It’s the thought of future that drives me. My obsession is with technology and how it can improve human life. In my view, what we have seen in the last 300 years is only a trailer. The next 20 years will overshadow the last 300 years-to the extent that we would not be able to fathom today.

I wish I was 30 years old today. The opportunity in front of us today is huge.

But it is also scary?

It is. But from my point of view it is really about having a purpose. I have always believed that the purpose of business has to be something more than only making money. The purpose of Reliance–it has been put on our website–is to first create societal value, then create customer value, then create employee value, and then create sustainable shareholder value. Reliance is not about blindly chasing profit. It has never been our purpose-not when we founded it, not when I joined it, not when we did the 1.8-crore IPO in 1977 or when we were a few crores of textile business. Nor is it now. At that time, the ingrained purpose was how do we clothe more people? What can we do to make India energy sufficient?

I believe 50 years from now when you write history, one technology that would have changed human civilization is going to be the mobile internet. In 2011 it was hazy. In 2002, it was even hazier. But today, I have no doubts, the world has no doubts, that mobile internet is a life-changing, world-changing technology of this century. Yes, it will evolve into many different things. But as a core technology it is a huge opportunity. And only the people who take some risks will reap rewards.

So you were very clear that you would get into this?

In business, it is always good to back a winning horse. But the challenge is to be the first to know which is the winning horse. We saw mobile internet as the winning horse before anybody else did. The mobile internet has won the world over. Companies that had bet on mobile internet have created the largest value in the last 10 years.

So, Jio is not really a telecom company . It is a tech company.

We really think so and I appreciate you saying that. We are not an old world telecom company.

Q. When you started Infocomm in 2002, you had said its distinguishing factor would be data and digital. It’s been 13 years and the two are going to be key drivers of Jio. Have the last 10-12 years been a lost decade for Indian telecom?

The facts speak for themselves. We as Indians cannot and should not accept the fact that we are 155th in the world out of 230 countries in broadband and mobile internet access. We have to change this. Just as, for a country of 1.2 billion, it is not acceptable that we win only two Olympic medals. For us and the next generation, this has to be unacceptable. The important thing is to figure out what we can do to correct the situation today. Jio will enable India to be among the top 10 countries in broadband and internet access within the next few years.

Q. Perceptions can make or break a brand. The last time when you had launched a telecom brand, it had come to be seen as a poor man’s service by some. How do you plan to address these issues, which are being talked about again?

A brand is directly proportionate to the amount of value it creates for customers. As I have always said, our attempt is to be known as a customer-obsessed organization. We also think that this (mobile internet) is such an important technology that it has to be available to all Indians. It’s the core infrastructure technology.

We will do everything that we can to create customer value. That is why we have made a commitment that 90% of Indians should be able to access Jio services over the next few months–by around March next year. This in itself is historic. We will be all across the country, except for a few villages. We are still challenging ourselves to cover these remaining villages too.

After that, I think it just depends on how much value we create for the customer. If we create value for you, we deserve to be a brand. And if we don’t, then we are committed to improve. We have the best professional resources, and we have adequate financial resources, and we have a steely resolve and intent. If you put all of this together, with a little bit of luck, we should be able to create great consumer experience.

You said in your AGM speech that you want to acquire 100 million customers in the shortest possible time. What is that shortest possible time?

We have built an eco-system. Sometimes, in an eco-system, you never know what will happen. This is the eco-system where all our device partners have to come up, the existing devices have to come in, the retailers have to come in. After this, we have the on-boarding of customers.

We didn’t expect that the 45 minutes (of speech at the AGM) will create the kind of euphoria that it has across the country. This has not only been in the metros, but also in the smaller towns and villages.

As I have said in my AGM speech, we are unhappy and we will not accept the present customer on-boarding experience. We are rolling out this week a new experience for all our customers starting with the metros and progressively going all across the country. in the next few weeks. Surely we will learn from that. We have created a capacity to take a 100 million customers. Now it depends on the customers. But I am confident that Jio will create history by reaching the milestone of 100 million customers in the shortest period in the world.

Do you have a number on how many people have you signed up as yet?

As we have the highest standards of governance, we will be putting out these numbers on a quarterly basis. I am pushing all our guys to see how transparent we can be so that we put these numbers out on a periodic basis.monthly basis.

What exactly do you mean when you say you will roll out a new experience, and when you say you have not been happy with the present experience?

Today if you want to buy a mobile connection, you go to a store, give an identification to get SIM card. Then there is a tele-verification… activation can take 8-12 hours in big towns and a day or two in smaller ones. In even smaller towns and tehsils, it takes 3 or 4 or even 5 days. This can be painful.

We are rolling an Aadhar number based eKYC verification that gives you a completely end-to-end digital piecesolution that completes the activation in 10-15 minutes. I am now pushing my team to bring it down for completing it in single-digit minutes. As Nandan Nilekani says, with the use of Aadhar-enabled eKYC, shifting from one operator to another (number portability) can be done in 15 minutes against up to seven days now. This is customer empowerment. Operators will have to create more customer value (to prevent users from moving out to another operator).

Some of us have grown up under the license raj and protection. All of us are much happier today, we are more competitive and we innovate in the market. Even in this industry, it is important that we give customers the right to their numbers and don’t harass them unnecessarily, by taking seven days in portability. Today some of our own employees are having a tough time to migrate to Jio (laughs).

At the AGM you spoke about the “unfair hurdles” that perhaps your company has been facing in terms of portability and interconnectivity. Jio customers are facing problem in making calls to non-Jio networks. If you could speak to your competitors in the industry– like Sunil Mittal (of Airtel) or Mr Kumar Mangalam Birla (of Idea Cellular) – what would you tell them?

I would repeat what I said at the AGM that this is the biggest opportunity that all of us have together. India is a very big country and no one company or one individual can do it. This is time for us to get together and to make sure that we deliver the vision of our Prime Minister Narendra Modi for giving Digital India to 1.2 billion Indians. We have an opportunity to lead India into this digital world. I have the greatest respect for Airtel, Vodafone, Idea and all other operators who have connected the entire country.

Today the Jio network is experiencing call failures. It’s essential that incumbent power is not used to deny new technology to consumers. It’s like saying that because you are a dominant person, you violate traffic lights. You can be let off once or twice, maybe. But in the long run, you cannot take violation of legal license obligations lightly.

I think that the old telecom industry is used to using incumbent power, and this happens across the world. But I think these tactics don’t work anymore. A Jio user will figure out that nothing is wrong with the service. I am going to take a fullof the view, this will be more in terms of saying that the customer will soon start questioning if the incumbents are anti-consumer.

Our view is that inter-connect is a few weeks issue. You cannot break the law beyond a few weeks.

From a practical point of view, this is a matter of survival for them. You are a million pound guerrilla. Isn’t it natural for them to try and protect their turf?

I think the good thing in the technology business is that it is the ideas that count, size does not count. It’s the quality of your ideas and how you execute that counts. But at the same time, it is also very important we all follow certain rules of the game. And the rules of the game are very clear. It is there in the license that you are supposed to provide inter-connect. In fact, you are supposed to provide it irrespective of the traffic. Those rules are laid down when each one of us signed our license obligations. None of us have a right to go beyond, as that obligation is not to each other as competitors, but to the customer.

Q. With Reliance Infocomm, you changed the industry. But one big problem was with billing. People still have memories of it.

I think what we did last time and what we are doing now are as different as chalk and cheese. Jio is audacious in terms of our aspirations. It is audacious by global standards. No operator in the world has ventured to do an all-IP (one network that transports all services–voice, data, video…by encapsulating them into internet protocol) at this scale.

In that sense, we are the world’s largest start-up. Nobody has put Rs 150,000 crore without seeing one dollar of revenue. We have the world’s largest VOLTE (voice over LTE) system. Two years ago, the talk was very clear that voice will not work (on LTE). Today, we are actually very proud of our voice. It is crystal clear, it has the best call connect time and lowest call drop.

Everybody said India is a KB (kilobyte) or a MB (megabyte) country. They will never use GB (gigabyte). This used to bother me. We had to go through extensive trials. We have gone through extensive trials in virtually everything – fine-tuning our voice, fine-tuning our IP, fine-tuning our data, fine-tuning our capacity, and fine-turning our indoor coverage. When you are doing things for the first time, you have to be thorough. Through the Jio Welcome Offer, customers will get an experience in terms of how they will be able to see their bills, how they will be able to pay for their bill. This will run for at least two cycles so that they become comfortable.
We think that there is space for (traditional) telecom business too. There is a market for voice and SMS. We don’t think that all voice will become free. In transportation, there is space for bullet trains, airplanes and buses – all co-exist. It is not a question of this or that.

You announced lifetime free voice calling at a time when 70% of industry’s revenues come from voice. How did this idea come up?

If you noticed my public utterances, and I speak very rarely, I made this point (of free voice call) more than once in the past. I had spoken in Delhi at a Brown University function where the president of Brown and the media were present. I had met the CEO of Verizon and he had said, “Oh in your country you still charge for voice? We stopped doing that long ago.” This was 2014. The world-over, it has happened. We have been consistently saying this, but nobody believed us.

You have made huge investments. You call yourself a start-up. Most of the start-ups are also known for burning cash. At the end of the day, you have to make money. How much time will you take to start earning money and make Jio a profitable venture?

I believe that if you create societal value, if you create customer value and employee value, and if you focus on these, then shareholder and economic return is a by-product. This has been my father’s big lesson for all of us at Reliance. And I am a big believer in that.

I don’t chase businesses for profits. I chase businesses for value and that’s why I look at technology. How technology can create maximum value and how can you be the most efficient.

I don’t want to speculate (on revenues and profits) primarily due to governance standards. We cannot tell any one individual about our financial projections. We will give guidance in terms of our quarterly results at an appropriate time on a non-discriminatory basis.

But I can share the principles. The first principle is that we believe that this business will give us – and we are not looking for a killer return -adequate and robust returns to our balance sheet. So, we are looking at a high teens return on our capital. And high teens is pretty good at this size. We are pretty confident we will achieve that.

Jio is about customer services. How do you react when someone says old Indian conglomerates like the Ambanis are not good at building a consumer businesses?

We are not offended. We let our actions speak. And we win hearts of people. It’s not about one Ambani or one ABCD. This is really a tribute and a challenge to the 60,000 people of Jio. These are all professionals – they are software engineers, marketing professionals… They are young Indians and their average age is 30. It’s our job to motivate them, to say that we can be better than anybody else in the world.

You never formally announced a launch date earlier, and it seemed you were pushing back. Were their internal tech issues, or customer facing issues? What took you so much time.

We were not pushing it back. What we were really doing was putting the whole eco-system together. There were multiple moving variables and we had to feel comfortable of the outcomes. I have been using the service for the last two years and we had our employees using it since December 27 last year. The numbers went up from a few thousands to tens of thousands and to a few lakhs and then we added a few more lakhs in June and again in July.

We also needed the 850 MHz spectrum, which we got only in end of July. It took us a few weeks to optimize the spectrum. That gave us flawless indoor coverage across the cities.

You were also accused by your rivals of managing the regulatory environment?

I need to ask you a counter question – what is the accusation about? We only put the customer first. There is nothing wrong in testing, and being transparent about it.

… the allegations were in terms of regulator, the Trai?

I am struggling to find out what the accusation is. Is it that we conducted trials? When you are doing so many things for the first time, it is better to do trials. We were transparent about it and we have written to everybody, including our competitors. At the end of the day, all of us have to stand for customer interest first and only then for operator interest.

There is another allegation that we are giving free service to our customers. Why will I not give free service to my customers to get them used to mobile internet, and to get every small town and village to use it? Everybody does promotions. In the internet world, free is normal. Whatsapp does everything free in terms of all the basic pieces. Reliance has far too much credibility, globally and in India, for such allegations to work.

One new area that Jio is getting into is content. You already have a media platform that generates content, but content is an ocean. What are the challenges facing Jio in delivering the content?

The critical thing, which remains a big challenge, is regional content. One can aggregate English content from around the world, but how do we make it relevant to 750 million people who are not well versed with English? We have put all our young people on navigating this challenge. It’s also not so much about entertainment but about educational content. The hunger in young Indians for Coursera and edX will be there. But they might not be comfortable with English. We must deliver it in their own language. We are doing some smart things there. We have solved some parts of this, but we are yet to solve it completely.?

Jio is building a huge app ecosystem to deliver digital services. You have announced a Rs 5,000 crore venture capital fund. Are you looking at partnering with entrepreneurs in building the Jio world?

When we put together four things — connectivity, computing, information and software — the price-performance of everything changes. It’s because of these four principles that Uber is the world’s largest transportation company without owning a single car or driver. Or Airbnb is the largest hotel company without having a single room. We believe this age is just beginning. It’s a combination of phenomenal domain expertise and user experience, a combination of the left and the right brain.?

Why this fund? We have built a large digital infrastructure and we now need to build digital services, which is a matter of ideas. What we need is to raise the standard of execution and delivery in India. We are going to provide young people the best infrastructure, best protocols and access to a big connected market. I think our youth is no less to their counterparts elsewhere but they lacked opportunities. In our entrepreneurship hubs, we’re calling these young entrepreneurs to solve the problems of people, small businesses, government and the broader society. We want to provide the ecosystem and set new standards of execution, which is easier in a connected world.?These businesses will be theirs. We will partner with them depending on their aspirations.

Think of WhatsApp, it was a team of 12 people, which changed the world of texting communication which was earlier fully owned by telecom companies. The whole world is moving to collaboration and partnerships, nobody can stand alone

Talking about funding, these startups that Jio supports will be captive to your network?

Not at all. We are big believers in the open world. It will be a proper venture capital fund. What we’re providing them is access to an ecosystem. Entrepreneurial teams can come with ideas and aspirations to share our infrastructure. It’s your idea and your business. It’s not a capital intensive affair, they need capital for marketing and product development. If we like it, we will invest more and more. Otherwise they can tap outside funding to build it further. We will be a consistent provider of capital to Indian entrepreneurs who can solve problems through which they can change India and the world. I have always felt that India needs a thousand Dhirubhais and it’s time to accelerate that process of finding them.

Now that you mentioned Dhirubhai, what are the similarities you share with him?

There can be only one Dhirubhai. There cannot be any comparison, genuinely. I am only fortunate to be executing what my father had envisioned. His philosophy of business and of life is timeless. We have institutionalized it within the group through the Reliance Management System. The whole framework is his and will remain so. This is the Reliance he had envisioned. It’s now on a path for the next generation to take it to greater heights. He always said ‘Think of the last man. If you can’t benefit him, then the business is not worth it’.

Mukesh Ambani with brother Anil and father Dhirubhai Ambani

There’s an argument some people make that Reliance Retail hasn’t had the desired impact in the retailing industry…

We always respect people who doubt us. It doesn’t bother us but only improves our resolve. We’re very proud of our 3 crore regular shoppers and 2.5 million people who walk through our stores every week. And the fact of the matter is that we are profitable, one of the few players to be so in the sector. I am very proud of what we have achieved in consumer business in such a short span, but at the same time we are committed to improving the experience and delivering better shareholder value. For us, consumer is a holistic game, whether it’s offline, digital and omni-channel. I have publicly stated that consumer business in size and scope will be as big as our refining and materials business. I am a big believer in making sure that I under promise and over deliver.

With Jio, do you think your retailing gets a multiplier effect to take on the likes of Amazon…?

We don’t have to take on anyone, the market is big enough to accommodate all. We believe that consumption is going to happen physically and digitally. And each one of us will have to create our own customer value. We don’t believe in discounting to build market share. That’s not my philosophy. I would rather invest into making the consumer buy physically or become more aware about digital. We have not yet seen the power of combining physical-digital consumption. The benefit of Uber is an example of that, and we can now take this everywhere. All consumer businesses will be enhanced by this physical-digital combination.

Reliance Industries, as a group, owns sizable stakes in internet companies like BookMyShow, HomeShop18 and others. How do you see them fitting into the Jio ecosystem?

Some of these investments we inherited. We have great respect for Ashish Hemrajani (of BookMyShow). Jio will work with global and Indian partners to create a digital life experience (for consumers) which is magical. Of course, if these entrepreneurs do well, it will give us strong financial returns. Otherwise we respect entrepreneurs for what they are. The new world is about collaboration, it’s about partnership and getting together to delight consumers.

So there are no plans to acquire some of them?

Absolutely not. Instead we are focused on multiplying the entrepreneurial energy. We think it’s better only being a critical part of that ecosystem because there’s nothing one gains by acquiring them.

What role will your children play in future RIL? You spoke about them in the AGM. Have you chartered any specific roles for them?

I spoke about them in the context of the next generation at RIL. Again, one thing that is not appreciated (and we haven’t talked about it much also) is the sustainable management practices we have put forth in RIL, which Jio also has imbibed. It’s our endeavour to keep average age of leadership at RIL in the mid-40s and the average age of employees at 30. We are extremely excited about the hunger of young talent we are bringing into the company. I think that generation, of which Isha and Akash are part of, is 10x better than mine. We need to give them an opportunity to realize their full potential.

Siblings Akash and Isha Ambani

As far as my children are concerned, it is for them to figure out what their passions are. Isha is going to Stanford for MBA this Fall and Akash is absorbed with technology and obsessed about improving the Jio customer experience. The good thing about children is that they can tell you, “Dad, you don’t get it!”

There were questions about RIL stock performance in the last AGM. What do you think about the short-term direction of the stock and would you consider de-mergering some of the newer businesses?

There are only a handful of companies in the world which have delivered a compounded annual growth rate of 20% or more in shareholder returns. RIL has done it consistently for 39 years. I am always a believer that it should be better. Ever since we went public in 1977, we have always made investments in new businesses and reaped great returns. We are currently at the end of the largest capital cycle in the history of RIL. As I mentioned in the shareholder meeting, there has been a lot of work at progress in the last five years.

The numbers will look much better as we enter our 40th year. The ongoing capital cycle, first time when two major capex programs (telecom and refining & petrochemical) are running simultaneously, is setting up the company for stronger returns in the next decade or two.

RIL had plans to foray into financial services (also the flavour of the season in stock markets) for sometime now. What action can we expect as you launch payments bank and Jio Money?

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