Vodafone Group Sees Reliance Jio as Formidable Adversary in Indian Telecom Market, Says Chief Executive Vittorio Colao

Vodafone Group sees Mukesh Ambani-led Reliance Jio as a formidable adversary in India’s fiercely competitive telecom market, which has forced the telecom group to cut the value of its India unit by Rs 36,448 crore.

Vittorio Colao-Vodafone

Vittorio Colao

According to an Economic Times report, Vodafone Plc chief executive Vittorio Colao has asked business heads of the Indian unit to leave no stone unturned in combating Reliance Jio ahead of its proposed merger with Aditya Birla Group-led Idea Cellular.

Vodafone and the Aditya Birla Group had last month confirmed that they were in talks to merge Vodafone India and Idea in an all-share deal. The deal would create the country’s biggest telecom operator by users and revenue market share.

Colao reportedly told Indian executives that the proposed combined entity would be a co-managed company.

Also Read: Reliance Jio Aims to Disrupt Taxi Space With App-Based Taxi Service: Report

Vodafone already has equally owned JVs with Liberty Global and Hutchison in the Netherlands and Australia, respectively. It now plans to have a similar joint venture in India.

The chief executive expects a satisfactory conclusion to the merger with Idea Cellular, which is likely to take around 12-15 months to complete. It requires approvals from the telecom department, Competition Commission of India and three courts.

Colao told the Indian executives that a new chief executive officer of the proposed merged entity would be named a few months before the conclusion of the merger.

Also Read: Reliance Jio’s Free Services Led to Rs 685 Crore Losses to Govt, TC Pulls Up TRAI

The proposed merger of Vodafone and Idea Cellular will create a telco with 35% network capacity share in the country, surpassing Reliance Jio, which would have 31% network capacity share, according to Credit Suisse. It, however, added that the Mukesh Ambani-led telco would continue to lead in the capacity proportion of data networks “by virtue of its large data spectrum holdings and exclusive 4G deployment.”

Both the firms have reportedly appointed consultancy firms EY and Deloitte, respectively, to conduct due diligence for the proposed merger. Credit Suisse report also noted that there would be an imbalance in the combined entity’s revenue market share (RMS) and network capacity share.

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18 Comments on "Vodafone Group Sees Reliance Jio as Formidable Adversary in Indian Telecom Market, Says Chief Executive Vittorio Colao"

 

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tri_vis
February 26, 2017 10:34 pm 10:34 PM

so time turnarounds. An Indian company beats British giant.

Girish Gowda
February 26, 2017 10:18 pm 10:18 PM

It’s okay Vodafone. Aren’t you the ones who said Indians aren’t ready for high technology like 4G and VoLTE? You can continue with your high prices.

R.Madhavan
February 26, 2017 12:11 am 12:11 AM

Vodafone has stopped offering 4G data in Monthly recharge packs in TN circle.

Rs.347 offered un limited local and std calls with 1 GB 4G data for 4G phones and 50 MB data for 3G and 2G phones valid for 28 days.

Now this pack offers unlimited local and std calls and 1GB 3G data only valid for 28 days.

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Nikhil
February 26, 2017 2:39 am 2:39 AM

I would like to see condition of avoid on 1 April 2018!!!!!

Nikhil
February 26, 2017 2:38 am 2:38 AM

Lol

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