Ask any Reliance Jio insider and you will be told Building TC-22 at the Jio headquarters in Navi Mumbai is where the action is. On the seventh floor is Mukesh Ambani’s DA’s desk – four feet wide, bare and with a telephone on it – one among 200 other workstations on the floor.
“MDA spends a couple of hours every Wednesday here,” says a Jio executive. MDA, as in Mukesh Dhirubhai Ambani, India’s richest man and the chairman of the Reliance Industries group of companies. “I personally thought that this wouldn’t work for long. But it has. There is no hierarchy and it is totally flat organisation, very different from the refinery business,” says the executive.
Why the open-plan office, especially for Ambani who spent most of his career in offices where business was conducted behind closed doors? “To retain talent,” says a second source, a senior Reliance executive. “It is a much more connected world today. We don’t come with a legacy mindset of how to run a business… who will do what, the kind of people. As MDA often says, we are a startup. We have to behave like one.”
For sure, Jio started operations just about 16 months ago. It sees itself in the digital business, not as a telco. Most of its people are in the twenties and thirties. And, its staff – with an unusual proportion of foreigners – are pushed to disrupt every aspect of Jio’s operations: the network, building security systems, devices, branding, consumer behaviour etc.
This is the story of those expats and how they changed Jio’s fortunes and indeed the Indian telecom business. Most of them were personally hired by Ambani and his lieutenants signing on the talent from across industries and the globe in the last seven years.
The second source quoted earlier confirms that as much as 15% of the 20,000 people working at the Jio Navi Mumbai campus are expats – many of them in key roles. For the two months that FactorDaily worked on this story, Jio turned down its requests for meetings with any of its expats and attempts to contact them individually were mostly unsuccessful.
First, a quick list of the senior expats. Jio’s chief product and innovation officer is former Deutsche Telekom executive Rainer Deutschmann. Networks is headed by ex-Sprint CTO Mathew Oommen, an American with Indian roots. Stratos Davlos, poached from Apple, heads platform and engineering and was instrumental in developing the Hello Jio voice assistant. Jordanian Tariq Amin leads tech development and automation. Caroline Seifert was its chief brand and design officer for a year. Janina Anjuli Schmidt worked closely with Seifert and now leads design. Chinese Shuming Li looks after all of Jio’s wifi rollouts. Marcus Brackebusch was one of the brains behind platforms and systems (Jan 2015 to May 2017). And Nikola Sucevic, a Swedish data scientist, leads data analytics development in area of radio coverage and capacity, machine learning, and telecom data mining.
This is just the top of the funnel. “There is a significant number of people at a variety of levels… from super senior most people reporting directly to MDA, to straight down,” says keen Jio watcher Kunal Bajaj, a former director at Paytm and ex-India head of consultancy Analysys Mason.
To be sure, this is not the first time Reliance Industries is working with expats. Even in Jamnagar, its refinery was set up by foreign experts with long years in the petroleum business. “The group has always worked with international people. With digital it has grown further,” says the second source.
FactorDaily interviewed nearly a dozen people within and outside Jio to get an understanding of how Ambani’s team of expats works and how it helped building an enterprise that is the fastest growing telecom company in the world with some 146 million subscribers. And, perhaps of more import, how they helped seed a data revolution in India.
When Ambani decided to build Jio in 2011, he knew it had to be different from the very beginning if it was to disrupt incumbents. This meant going to the core of a telecom business operation: its network. For the first time, any telecom operator in India had decided to build a 4G network, primarily focussed on data. Even calls on Jio’s network would run on data.
In a country just embracing 3G technology, Jio’s punt on 4G was amusing. Airtel, Vodafone India, Idea Cellular among others were still rolling out the 3G network and waiting for people to taste internet on 2 or 2.5G networks. To be sure, globally, companies such as Vodafone, China Telecom, and Verizon had started building 4G networks. But, nowhere in the world had a telecom company built an LTE-only network from scratch.
“Jio came in late, but it had an advantage of setting up a network that was futuristic. The Jio network is 5G ready,” says telecom veteran T V Ramachandran. “Jio went on with deployment of 4G equipment, others thought Ambani was doing a mistake.”
India didn’t have much talent to build this network. Ramachandran explains that apart from makers of telecom equipment like Ericsson, Nokia and Huawei, no one was spending on building R&D around networks. “When you don’t have people in India doing that, the best thing is to get people from abroad to set it up,” he says, adding that BT (the erstwhile British Telecom) – and now Jio – is the rare telco that does network R&D. Ramachandran was formerly the director general of lobby group Cellular Operators Association of India and resident director for regulatory affairs at Vodafone India.
Ambani handpicked Oommen, who was earlier the chief technology officer of Sprint, responsible for network and technology development, systems architecture, and device development.
Oommen had worked with Reliance Infocomm – the telecom services business that Ambani had started in 2003 but had to part ways with in a family business split with brother Anil – earlier and wasn’t difficult for Jio to get him back to India. “Oommen is one of the top five guys in the world in network technologies,” says a source, who works closely with the Indian-born American.
His network team is from across the world. Jio has the largest fibre backhaul network, and its radio network is wider than anyone else. Oommen helped design a network where everything rides on data, even voice. As a result, voice consumers only use 10-15% of the bandwidth, allowing Jio utilize more of its network for data.
A senior executive of an incumbent operator says, “While we are deploying LTE network, 50-60% of our network utilisation is still for voice. Jio’s is much less.”
The network is pivotal to Jio’s strategy and one of the four top differentiators it has to grab customer market share – the other three being cheap devices, a large family of apps, and low tariffs. These three would be ineffective without a data-ready network.
Oommen knew that. On the IP-based Jio network, the cost of servicing data and calls is eight paise a minute. For others, it is about 30 paise but this includes the contentious interconnection usage charge (IUC, which is what one operator pays another to land a call). Jio has argued for the removal of IUC, currently set at 14 paise a minute, which will help its margins. All that was thought through since the beginning, thanks to Oommen.
He continues to travel for a couple of weeks every couple of months. “He has a team in the US to do a lot of international tie-ups… who work on network innovation. His team here has a lot of expats – mostly people of Indian origin who wanted to come back,” says the person who works with Oommen.
Once the network was in place Ambani wanted to tackle the next big hurdle: devices. Even there, he found out that Jio was in a virgin territory.
Early in 2003, months before the Reliance Infocomm launch, Ambani had asked colleagues at a meeting: “What is the cheapest cost of communication?”
“A postcard!” he answered his own question. “That costs 40 paise.” The calling rate in an offer called Monsoon Hungama launched July 2003 was set at 40 paise a minute.
In 2011, Ambani was following the same affordability playbook: 4G smartphones had to be affordable. He and a few others visited China and met with several phonemakers. “A lot of innovation was happening in China… Half of the world’s devices are made in China,” says the senior Jio executive, who’s the second source in this story.
Beginning 2012, Jio started sending a lot of people from Mumbai to China to put together the devices strategy and roll it out. The only 4G devices were from Apple and Samsung and they were very expensive and wasn’t fitting into Jio’s plan. “We were always thinking of hundreds of millions of customers and in that context, LYF was created,” says the second source. LYF was the initial crop of custom-readied phones for Jio, which then made way for the JioPhone.
The TC-22 tower was again the hub of Jio’s work on devices. A team of designers was put together from different countries: China, Germany, England, Israel and the US. The team spent an inordinate amount of time in China. Adding an extra band for 4G services to existing phones would make them costlier by Rs 2,500 to Rs 3,000. So, the LYF phone was designed from scratch with partners in Europe and China. It took them a year to make it but they could price it at Rs 4,000.
Within months of launch in the first quarter of 2016, LYF captured 7% market share in smartphones in India, according to data from Counterpoint Research. By the third quarter, phone was out of stock. “With the commercial launch of Reliance Jio service with attractive introductory offer, the LYF branded smartphones saw a sharp demand with reports of stock outs at some locations,” Jaipal Singh, analyst — Client Devices, IDC wrote in a report.
Soon, the market followed Jio and LYF and suddenly 4G smartphones were much cheaper. Between September 2016 and September 2017, the 4G smartphone base went up from 86 million to 178 million. Jio gained the most with its first mover advantage – from 16 million to 139 million – during the period.
But it wasn’t easy for the expat designers. “LTE is a very dynamic network. The networks are constantly optimising itself, and there are software-driven-networks. There is no human intervention. That interaction with devices is constantly changing,” says a third Jio source, who is one of the expats.
The device designers had to make sure that the experience was good enough. “There are some bands we had to struggle with in the beginning – latching on and delatching every couple of hours. The customer doesn’t know that it was a device problem, they blamed the network,” says the third source.
Jio’s hires from Apple came with their learnings. Apple monitors everything: good coverage, bad coverage… all parts of the voice over LTE experience. Most device companies don’t. “Our device team does it. For every device type, there is an assessment. The ones those are not working properly we start working on it. All of that is done in-house by our teams,” adds the third source. There is a daily report that is prepared, which brings in every data point and is completely automated.
A dominant share of new 4G additions was good but Jio realised that to attract a large number of users of feature phones, which typically are voice and SMS only, the Rs 4,000 tag for new phones was too high. So, the design team, full of expats, worked on what would be called JioPhone – a smart feature phone. It was not easy. “We are not a devices company, we don’t make phones. But, the team figured the lowest we can go to give a smartphone experience,” says the second source.
With LYF, Jio had brought down the price of 4G phones to one-fourth of extant prices. With JioPhone, it further reduced the price to the level of feature phones.
The market is not rid of quick copycats. Soon, every operator partnered with the likes of Micromax, Karbonn, Intex and Lava to make cheap smartphones and bundle them with services – India’s data world was being disrupted.
Finding people has become a little bit easier since the September 2016 launch of Jio. One big advantage that really excited a lot of people was the vision of Jio, which made people come and work here. “MDA and (Manoj) Modi – they were meeting people personally. They have been the HR managers,” says the second source.
During one such meeting, Jio hired someone from Apple to build the entire customer service and experience. FactorDaily is not certain about this person but it most likely to be Stratos Davlos, the head of platform and engineering.
“The user experience is from someone who has come from Apple. He built his team here and got more people from Apple,” says the second source, without giving the name of Davlos.
Another Jio executive working closely with the team confirmed it is a 20-25 member team. MyJio was the first app that it started to build, which allows users to recharge their phones, track usage, get coupons, and gift vouchers to friends and family. MyJio, the company claims, is the fastest app to get 100 million downloads. The team didn’t stop there – it wanted to extend the same user experience to its cinema and live television apps.
“Jio has been a digital company from Day 1. Linking media, content and entertainment and pushing the data revolution from the beginning is what they are working at. Unlike other telcos, integration of content and the network started in Jio from the very beginning… which is critical to deliver a seamless customer experience,” says Mritunjay Kapur, a partner at KPMG India specialising in telecom, among other industries.
As a result of the cheap data, deep integration and user experience, use of data on the Jio network jumped. On an average, the nearly-150 million Jio users consume 10GB of data per month.
Free content and low data prices have resulted in a data war in the country with every telecom operator building its network. In January, to counter Jio’s growing demand, incumbent Airtel cut tariff. “Airtel knew that Jio would follow up on any tariff cut. Despite this, Airtel launched these new offers. We believe that it is investing heavily to build a strong network that can sustain high traffic. We now see the market moving to 1.5GB per day plans from 1GB per day,” Sachin Salgaonkar, analyst with DSP Merrill Lynch, wrote a report last week.
Once Jio had its pricing in place, it went after innovative marketing. Ambani hired Caroline Seifert as chief brand and design head in January 2015. Seifert had spent nine years with Deutsche Telekom.
She was the brain behind design the visiting cards, the logo, the colour and look and feel of the campaigns. A person who has worked with Seifert says that the cards do not have a specific colour. “It is versatile,” says a company source familiar with her work. The dots around the Jio logo also have different colours, depending on the background against which it is placed — much like counter-intuitive brands like Google. Seifert left Jio in 2016, and Janina Anjuli Schmidt is now the design lead at Jio.
This source says that every brand campaign that is done looks at a different segment of users. “The look and feel of the campaign is accordingly designed to appeal to a large number of people.”
Jio knew a single version of a campaign doesn’t fit all of India and so bought technology and language translation licences from SDL, a London-headquartered company. “It was the first time any telecom operator was buying licences for the entire stack,” says Richard Delanty, who worked closely with Jio and was the senior VP – sales and operations at SDL.
Soon SDL was flying people to Mumbai for large integrations. “Jio was running multilingual campaigns, but the entire workflow was automated, which gave Jio the ability to do multi-region roll-outs at speed and scale,” says Delanty. Once a campaign was designed in English, at the press of a button it would go to the translators and would come back after translation. Since the workflow was automated, there were no follow-ups and the campaigns would go to the respective regions.
In the beginning, Delanty says that SDL didn’t realise the scale and size of what Jio wanted to do. “New teams were formed every day… It was a hothouse environment. We had worked with other telecom companies, but nothing of this scale… Every campaign, in different translations were targeted at 100-200 million people,” says Delanty.
“The size, scale and speed of the network roll out were unprecedented… The availability of talent in the country wasn’t enough for something like this,” says Kapur of KPMG.
For Reliance it was important to collect a lot of network data, user insights and monitor the surges of usage. To begin with, Jio decided to get some people from the US, who had worked on analysing tons of data. In July 2015, Jio hired Nikola Sucevic, an ex-Ericsson executive with two decades of experience in telecom and data science. Others – Indians and foreigners – were hired from companies such as Microsoft and boutique artificial intelligence and data science companies. The data team has some 30 people.
Jio engages with several overseas companies on an assignment or contractual basis, too. For example, a US company – FactorDaily has been unable to confirm its name – helps to analyse data sets and throw up insights. “We are monitoring the throughput of the network – what each site is giving, each hour of the day…,” says a fourth source, who works closely with the data team.
“We are doing analytics on customer behaviour, customer recharges, what day, what time, how to incentivize… every network, every tower is generating data points. We are analysing all of that to make our customer experience better,” this source adds.
On the network security side, the team is headed by a person from the UK, aided by four other expats. The information security function was headed by hacker Karsten Nohl, famous for exposing flaws in telecom networks potentially affecting millions of users all over the world, for three years until March 2017.
“Network security is a big focus area for us. It is an end-to-end IP network. So far, there have been no breaches but we can’t be complacent,” says the second source. “That same team is also working on security of customer data.”
Reliance Industries’ corporate investments in a set of startups have helped. Technology from Israel’s Airspan is used in deploying low-power short-range towers. Vision-based analytics from NetraDyne is also being used. “We have invested in 25 odd companies. These we do to tap into the technology talent pool,” the fourth source says.
Young and expat hires have changed Jio and Reliance Industries. The desk next to Ambani’s on Level 7 at TC-22 is Anshuman Thakur’s. The former N M Rothschild and Morgan Stanley banker, whose LinkedIn profile just shows him as in “strategy & planning” at Reliance Industries, is in office mostly with his sleeves rolled up.
About half of the people working in Jio come to office casually attired, as FactorDaily noticed on a visit to the Jio office late last year. Ambani, who continues to dress in his usual white shirt and black trousers, is often seen huddled with employees in jeans and t-shirts. “If you look at them you can’t make out that they are doing such serious work,” says the second source, chuckling.
The casual attire was a big change within Reliance, so were Saturday holidays. “Now even one of the canteens have started serving non-vegetarian food,” says the second source. Jio employees go out in the evening to the gym or to play tennis and come back to work in shorts.
Still, there is a problem – most of the expats don’t move with their family. Most of them want to go back after some time, especially if they are not senior-level executives.
“The ecosystem for expats isn’t there. The [Reliance] group has a very good school, but then not everyone can be admitted. For expats to come and stay here, their lifestyle needs to be developed,” says a senior executive at Reliance. “If you want a 25-year old German to come and stay here, you either need to pay him a lot, otherwise he will struggle here.”
That’s a problem Ambani and Jio will have to deal with. Not everything comes easy when you are building a digital-first telecom services company in India – even if you have spent Rs 2 trillion building it.
(A version of this story was published in Mint newspaper on January 29, 2018.)