Jio, Airtel and Adani Group Can Build a Win-Win Situation for Everyone

The cost of developing telecom infrastructure is one of the biggest challenges/hurdles for any telecom company. Especially in a scattered market such as India where people live in the remotest corners and require network connectivity. Jio and Airtel have already invested thousands of crores to build that infrastructure.

Highlights

  • There is a lot of competition expected to build in the market once the Adani Group goes all in for providing telecom services in India.
  • The Indian government had allowed the telecom companies to share active infrastructure with each other in 2021.
  • One way to ensure that Jio and Airtel keep making money from the presence of the Adani Group is that they make a deal of sharing infrastructure with the Adani Group.

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There is a lot of competition expected to build in the market once the Adani Group goes all in for providing telecom services in India. Bharti Airtel and Reliance Jio’s revenue market share might go down significantly. But that’s not going to happen anytime soon. If the Adani Group wants, it can build a win-win situation for everyone.

The Indian government had allowed the telecom companies to share active infrastructure with each other in 2021. This was done to help the telcos in reducing costs and time taken to launch new services in the market.

One way to ensure that Jio and Airtel keep making money from the presence of the Adani Group is that they make a deal to share infrastructure with the Adani Group. This way, the Adani Group doesn’t need to push in huge sums of money to build infrastructure and wait years for ROI (return on investment) and Airtel and Jio keep earning money even if they lose on some clients or subscribers.

The cost of developing telecom infrastructure is one of the biggest challenges/hurdles for any telecom company. Especially in a scattered market such as India, where people live in the remotest corners and require network connectivity. Jio and Airtel have already invested thousands of crores in building that infrastructure. The Adani Group can just come and leverage that to make money.

Airtel or Jio Might Not Share Infra in the First Place

But there’s one more thing. Jio and Airtel might not want to share the telecom infra in the first place. They might be a little reluctant on account of helping out the competition in stealing their subscriber market share, which they built by bleeding money.

Adani Group is not foraying into the consumer telecom space for now. Thus, there’s no threat to the telcos in that area. Even in the enterprise segment, the Adani Group is going with a very passive strategy and would bid for a very limited spectrum.

The Earnest Money Deposit (EMD) submitted by the Adani Group is just Rs 100 crore, which is nothing major, to be honest. This means that the group might invest up to Rs 1,100 crore or less in the upcoming 5G spectrum auction. This has led to many analysts believing that it would be a very silent spectrum auction this time around.

Do you think the existing telcos will play it cool with the Adani Group and share infra? Do you think it would be the right strategy in the first place? Let us know in the comments below.

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Tanay is someone with whom you can chill and talk about technology and life. A fitness enthusiast and cricketer, he loves to read and write.

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