Telecom consolidation in India will lead to massive layoffs: Report

The ongoing consolidation drive will lead to massive layoffs in the Indian telecom industry with as many as a third of over three lakh employees becoming redundant in the next 18 months as consolidation plays out, according to an ET report.

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The Economic Times, citing various experts and executives, reported that massive job losses are inevitable as telecom operators merging operations will streamline their respective businesses to remove redundancy and cut costs. Indian telecom industry’s overall revenue is estimated at Rs 1.3 lakh crore annually, while people costs stand at Rs 34,000-35,000 crore.

“There is no doubt that staff at the head office and circle (offices) are on shaky ground, putting 10,000-25,000 jobs at risk, he said. Add those indirectly employed and the number could rise to as much as 1 lakh,” an HR head told the publication.

Currently, Reliance Communications (RCom) and Aircel are looking to merge their wireless operations to create a new merged entity. RCom is separately in the process of acquiring Sistema Shyam Teleservices to execute a three-way merger involving Aircel to create India’s fourth largest telecom operator by subscribers.

Smaller GSM telco Telenor is also looking to either merge with the RCom-Aircel combine or be acquired by Airtel, according to the report.

Separately, Kumar Mangalam Birla-owned Idea Cellular and Vodafone Plc are exploring an all-stock merger deal to counter Reliance Jio and Bharti Airtel. Vodafone Group and Aditya Birla Group have picked EY and Deloitte, respectively, for due diligence that includes a detailed look at the work structure.

Also read: RCom’s tower assets sale, merger with Aircel to take another 6-9 months to close; gets negative outlook from Moody’s

The consolidation drive is not just limited to telecom operators’ space but has taken hold of ancillary operations as well, especially towers. RCom is currently in the process of selling its tower business to Brookfield for $1.6 billion, whereas both Vodafone and Idea Cellular also said to be mulling over selling standalone operations. Bharti Infratel and Indus Towers may also see a change in control with divestment, the report said.

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9 Comments on "Telecom consolidation in India will lead to massive layoffs: Report"

 

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lalit
February 16, 2017 1:01 pm 1:01 PM

It has started – Aircel to Lay off 700 people across India in its 1st phase of layoffs.

shyam
February 16, 2017 11:09 am 11:09 AM

(off topic)
Airtel new offer !!!!
Rs 345/- (kerala circle)

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Pranav(Arena)
February 16, 2017 10:43 am 10:43 AM

Now or later in every tech industry job cuts are inevitable.

Aslam (Rajasthan)
February 16, 2017 12:12 am 12:12 AM

In my city jio third class speed always remaining like this
No improvement after many complaints
Now wanna throw jio sim

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ENAUD
February 15, 2017 11:41 pm 11:41 PM

Sad to see so many people impacted.

Shuvi
February 15, 2017 10:18 pm 10:18 PM

No jio lover want to see this. In one sim slot they keep jio sim and in second slot they need to take out airtel job out of thr cell fones

Kumar
February 17, 2017 10:45 am 10:45 AM

I’ll be happy when you lose job from Avoid. You avoid employees are paying for the sin in past. You didn’t care for customers, then why we customers would care for you. Stop blaming & pay for the sin you have done in past. Now your enjoyment using customers money going to end. Try for another job or beg in footpath, none cares about cheaters.
Note: To Avoid beggar employees, stop telling all customers using Jio 4G as beggars or any other insulting. Else you will beg in footpath not the customers.

bharat khanna
February 16, 2017 10:11 am 10:11 AM

+1

N KANAGADEEPAN, SIVAKASI (T.N.)
February 15, 2017 6:16 pm 6:16 PM

Sad, but TRUE…

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