Vodafone Idea Gets Hit With Call Drop Penalties Along With Other Telcos

Things have gotten from bad to worse for Vodafone Idea and other telecom operators. As if the dues of Adjusted Gross Revenue (AGR) dues was not enough burdening for the telcos, another pressure of penalties has been slapped on these companies. As per a new ET Telecom report, total penalties of Rs 3.2 crore have been levied on the telecom companies for call drops for the September-June 2018 quarter. The information was shared by Sanjay Dhotre, Minister of State for Communications, in Parliament on Thursday. Among all telecom operators, Vodafone Idea has again been hit in the worst way as most of the fines, in the quantum of Rs 1.76 crore have been levied on Vodafone Idea. These fines have been distributed as Rs 1.11 crore on account of Vodafone network and rest Rs 65 lakh on the Idea network. The least hit telecom operator, in this case, was the Mukesh Ambani led telecom operator, Reliance Jio, which only has to pay Rs 6.5 lakh.

Penalties Levied on Telcos for Call Drops

As for the other telecom operators who are facing these penalties, Bharat Sanchar Nigam Limited (BSNL) is looking at penalties of Rs 47.5 lakh, whereas Tata Teleservices will have to pay penalties of Rs 56 lakh. Additionally, there have been penalties of Rs 34 lakh on Bharti Airtel as well. Dhotre remarked in a written reply in Rajya Sabha that BSNL did not meet the benchmark of the minimum number of mobile tower functional in the service area, while the rest of telecom operators were found compliant to the rules. Also, in states like West Bengal and Vodafone Idea in Jammu and Kashmir circle as well, BSNL failed to meet the minimum criteria in regard to network availability.

Telecom Operators Under Pressure of AGR

It is worth noting that out of all the telecom operators, the worst-hit telco has been Vodafone Idea. The Adjusted Gross Revenue (AGR) matter which was passed in the Supreme Court on October 24, has undue pressure on the telecom industry — thus mounting on dues worth Rs 1.47 lakh crore on the companies on account of license fees, Spectrum Usage Charges (SUC), penalties and interests. The decision from the SC was in favour of the government, in which it said that the AGR would be calculated keeping in mind the non-core services as well. A huge chunk of these dues has fallen in the court of Vodafone Idea.

Vodafone Idea Worst Hit Telco

While the next in line is Bharti Airtel, Vodafone Idea has to pay dues worth of Rs 53,000 crore, while Airtel has to pay Rs 35,500 crore worth of dues to the Department of Telecommunications (DoT). On top of this, Vodafone Idea has got an additional Rs 1.11 crore of penalties to pay for the call drops. In terms of relief as well, things look bleak for telecom operators, as apart from a payment moratorium of two years, the telecom companies have not received any relief from the government in the AGR matter. Vodafone Idea, chairman, Kumar Mangalam Birla has also said that in case it does not receive any relief from the government, it would be a sign for Vodafone Idea to shut shop.

Things have been going downhill for Vodafone Idea as the telco has been consistently losing subscribers since the last few quarters and has been hit by penalties and dues which are to be paid in a very short notice. While Bharti Airtel has opted for the way of fundraising to pay off these dues and to ease the financial burden, this is not an option for Vodafone Idea.

Arpit Sharma

Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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Arpit Sharma