Vodafone Idea and Bharti Airtel Will Close Gap With Reliance Jio 4G Services Owing to Newly Raised Capital

Mukesh Ambani led telecom operator, Reliance Jio will work on its 5G services and speed up the rollout of the technology by the second half of the 2020 calendar year with the aim of obstructing gain of Vodafone Idea and Bharti Airtel through their 4G-led data monetisation. The report came from SBICap Securities and was brought to light by ET Telecom. SBICap Securities said that Reliance Jio’s announcement of stepping into the 5G field early is majorly driven by Vodafone Idea’s and Bharti Airtel’s plans of raising capital. As per Rajiv Sharma, co-head of research at SBICap Securities the 5G spectrum auction is likely to happen in January 2020.

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Reliance Jio ready for Early 5G Spectrum Sale

It is noteworthy that according to the previous reports, Reliance Jio is the only telecom operator in the sector which is in favour of an early 5G spectrum auction and is also supporting the recommended prices. This is unlike Bharti Airtel and Vodafone Idea who have opposed the early sale of the 5G spectrum. Airtel has also demanded to lower the cost of some sub-GHz band, and Vodafone Idea has asked the DoT to push the auction sale back to next year.

Sharma sees “Jio making a decisive 5G upgrade next year to make competition from Airtel and VIL on the 4G front irrelevant, in its bid to maintain leadership on the fast broadband technology, thought and revenue market share fronts.”

VIL and Airtel will Combinedly Raise Rs 50,000 Crore

Vodafone Idea and Bharti Airtel are both going to be raising as much as Rs 50,000 crore from their planned rights issue and imminent asset sales. Both the incumbents will thus narrow the gap between Jio’s 4G services and their own, and it will happen across all prominent urban markets. Sharma added to his words saying, “Jio’s early move to 5G is inevitable to sustain market share gains, and we see it selectively deploying this nextgen wireless broadband technology by the second half of 2020.”