Mukesh Ambani-led Reliance Industries, largely known for its energy and petrochemicals business, is going all out to position itself as a tech company to reckon with.

Its digital and telecom businesses subsidiary, Jio Platforms, is all set to launch AI-based cloud services from the first week of November. To start with, it has already offered 100 gigabytes of free cloud storage for Jio users. Google offers 15 GB of free cloud storage per user and charges Rs 130 a month for 100 GB of extra storage. Meanwhile, Apple offers 5 GB of iCloud storage and charges Rs 75 per month for 50 GB of additional storage.

Going by precedents, there’s a great chance that the offer will lure more people into its fold. Reliance followed a similar strategy when it launched 4G-enabled Jio services in September 2016. It offered free voice calls and data as part of the launch. In a price-sensitive Indian market, where competitors were giving 1 GB of 4G data for Rs 250-300 a month, Jio offered a GB free per day.

Users flocked to Jio at the time. And the rest is history. As of 31 March 2024, it had a customer base of 481.8 million—the largest in the country.

This digital expansion, however, has been a few years in the making.

Reliance’s tech venture: By launching Jio Platforms in 2019, Reliance transformed its telecom venture into a full-fledged digital tech platform. Jio Platforms, Reliance’s wholly-owned subsidiary, is the conglomerate’s digital arm. It houses telecom and internet services along with all things tech—from smart devices, AI and blockchain to augmented and virtual reality (AR/VR).

Jio Platforms is set to push Reliance’s image as a deep tech company, going by Ambani’s announcement at the conglomerate’s latest annual general meeting. He also said Reliance wants to make AI accessible to everyone, everywhere.

The announcement is not entirely surprising; Jio Platforms has expanded into various gadgets and digital offerings over the years—mobiles, laptops, VR headsets, USB cameras, JioTags and more. The platform also offers a wide range of apps such as JioCinema (OTT), JioSaavn (music), JioGames and JioBusiness.

Besides, both AI and cloud are offerings with great business potential. That, coupled with Reliance's penchant for free offerings and unique price points, could help it corner a huge market share again.

But that’s easier said than done.

Is cheap good enough? In the past, what has worked for Reliance, especially in the case of Jio, is pricing. Its low-price offers are what has its users hooked. Ambani, at the recent AGM, had reiterated that this was part of the company’s vision to make broadband-based services affordable to improve access across sections.

Udbhav Kush, a US-based AI developer and researcher, says this vision towards accessibility is what puts Reliance in a unique position. “Jio’s target audience would be anyone who carries a mobile phone in their pockets. Jio’s aim is to tap into the huge demand that India has for digital consumption, hence it tried its hands at everything related to technology offering at a low cost,” says Kush.

There’s merit to this argument. Jio started by making network connectivity available in remote locations and then launched mobile phones costing as little as Rs 999, which could host Jio’s entertainment services. This strategy helped it capture 40% market share, as of February, in terms of mobile subscriptions. It has 12 million fixed broadband subscribers, as of May, and 108 million 5G subscribers, as of April. In the 2023-34 fiscal, Jio’s data traffic increased 32% year-on-year.

That’s all very well, but is low pricing enough if Reliance wants to position itself as a tech company? Perhaps not.

“So far, Jio has been able to tap into various digital-based services. It has been able to onboard masses due to its existing platform and consumer base. However, its consumer tech products have been subpar in terms of quality and usability,” says a Bengaluru-based software engineer, who asked not to be named. “To be regarded as a serious tech company, it’s yet to test its mettle by creating state-of-art tech products and services, which it promises through its feature-stacked JioCloud.”

Even when Jio tried to enter the AR/VR segment, it failed to create an impact. Its VR headset, while much cheaper than what rivals offer, suffers from serious quality issues, according to user reviews. For instance, there have been multiple complaints about the bad display quality.

Also, in the variety of applications it hosts, the user interface and overall quality aren’t on a par with current industry standards, according to experts.

Its latest offerings, for instance, are JioAI and JioBrain, which offer cloud storage services for Jio users and cloud computing services for enterprises, respectively. And these are fairly complex tech solutions with significant costs.

So, does the company stand a real chance here?

Tapping into AI: One of the biggest challenges will be rivals. Right now, Amazon Web Services, Microsoft Azure and Google Cloud Platform dominate the cloud computing segment. As of November last year, Amazon Web Services had a market share of 32.6% in India, followed by Microsoft Azure (20.8%) and Google Cloud Platform (11.4%).

Now, these platforms have gotten this far on the back of their business models and quality of service offerings. For instance, Amazon Web Services focuses on providing every possible enterprise-grade service, which is highly scalable or elastic based on the needs of the client. If JioBrain is competing against Amazon Web Services, it will have to expand the scope of its services and gain credibility so that companies can trust it with their sensitive data.

The second challenge JioBrain could face is migration. “It’s not easy for big companies to migrate their existing tech infrastructure from one cloud service completely to another service as they are dealing with huge datasets. It's not very cost-effective and it is time-consuming,” says Kush. “Migration requires some of the services of the business to be on hold for some time. So, does it make sense for the company to incur that loss? It all depends on the migration cost and the time taken for it.”

In May, for instance, Ola launched Krutrim, a cloud computing platform that aims to fight the Big Tech monopoly. Even though it managed to crack the pricing, it couldn’t match the range of services offered by giants like Amazon and Azure. For more on this, read this edition of the news explainer. JioBrain would do well to take note of Krutrim’s shortcomings.

“As India is a developing economy, there is potential to adopt JioBrain products within the country. JioBrain should focus more on the price range that it offers as compared to its competitors. If JioBrain does so, it will at least cover a chunk of the Indian business market,” says Kush, adding that making cloud adoption strategies easy could also help acquire a chunk of the market.

After all, businesses are looking to cut costs here—and not additional costs by switching to a different cloud provider. The cloud market in India is still at a nascent stage and accounts for just 1.5% of the global public cloud market. This means there is scope for newer entrants like JioBrain to fulfill companies’ needs in a growing market. But for now, it seems Reliance has a long way to go.