Kumar Mangalam Birla Blames Jio for Falling Revenues, Profitability of Telecom Industry: Report

Aditya Birla Group chairman Kumar Mangalam Birla, in a letter to shareholders of Idea Cellular, reportedly blamed Mukesh Ambani-led Reliance Jio for causing unprecedented disruption in India’s telecom sector, which has led to two percent decline in annual revenues in 2016-17 fiscal, according to an ET report.

  • Make Telecom Talk My Trusted Source
  • Source of Google
  • Source of Google

iphone-se-3

India’s telecom industry is facing a decline in revenue and profitability on account of competition intensified by the entry of Reliance Jio. The sector is currently going through a major consolidation drive, powered by the entry of Reliance Jio, which launched commercial services in September 2016, disrupted the market with the free data and voice services, which officially ended on March 31, 2017. The telco is now charging for its services under its Dhana Dhan Dhan plans that offer unlimited voice and capped data for three months at affordable rates.

“It has been a ‘Period of Telecom Discontinuity’, permanently changing mobility business parameters,” Birla was quoted as saying. He added that financial parameters for all mobile operators have sharply declined.

Birla, however, hoped that the telecom sector would return to growth in 2017-18 with Jio starting to charge for its services, “albeit very slowly”.

Anil Ambani-led Reliance Communications is merging operations with Sistema Shyam Teleservices, and separately merging wireless operations with Aircel to give birth to a new telco, AirCom. Bharti Airtel is also acquiring Telenor’s India operations besides acquiring Tikona’s 4G spectrum and business to strengthen its 4G play against Reliance Jio.