Vodafone Idea Merger to Bring Stability in the Industry: Aruna Sundararajan

By July 27th, 2018 AT 3:56 PM

After obtaining the final nod from the Department of Telecommunications, Idea Cellular and Vodafone India will merge to form the biggest telco of the country – Vodafone Idea Ltd. After the merger, Vodafone India will cease to exist, and the assets and liabilities of the firm will be transferred to Idea Cellular. In this regard, Telecom Commission, the highest decision-making body in the Indian telecom industry has said that the consolidation of two big companies will bring stability to the sector.

Vodafone-India-Idea-LTD

Telecom Secretary, Aruna Sundararajan said to PTI that “We expect that with this merger, the market will begin to stabilise. We expect to see robust growth in the telecom sector with the emergence of three strong private sector players, and one public sector player.”

It is noteworthy that the Vodafone Idea merger was slated to be finalised by June end, however, owing to the demands raised by DoT for bank guarantees worth Rs 7,268 crore the merger was stalled. Now, both the telcos have agreed to the demands of DoT ‘under protest’ which has resulted in the finalisation of the long-awaited and the most prominent M&A in the industry right now.

Concerns regarding monopolisation and cartelisation have also surfaced after the merger. To these doubts, telecom secretary pointed out that in markets like the USA, three players have long served the consumers and even maintained stability. She said “This is a long-awaited merger and also a big milestone in the history of mergers in the country. Each player is a strong corporate, and I believe there will be more than enough competition, and good news for consumers.” She further added that it would be in the best interest of the industry if the companies are engaged and continue to offer different services to their customers, setting themselves apart.

Notably, this merger will forge the largest telecom entity in India with 35% market share and as much as 430 million subscribers. The company will surpass Bharti Airtel which stands with a massive 344 million customers now. The merged company will also be in a better position to handle competition in the sector, especially kicked off by Reliance Jio.

Chakri is a go-to guy for your next smartphone recommendation. Back in his engineering days, he used to play with smartphones by installing custom ROMs and that passion got him into the tech industry. He still goes nuts about a smartphone knocking his door for review. Currently managing everything at Telecom Talk, Chakri is trying to master PUBG Mobile in his free time.

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Pranav PadukoneManipalyeshNikhil Mumbai-PunePrithvi Recent comment authors
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Prithvi
Prithvi

Vodafone IDEA is much needed to preserve competition to the highest degree and its about time Indian customers get their due. I congratulate Vodafone + IDEA for the successful merger.

Nikhil Mumbai-Pune
Nikhil Mumbai-Pune

That should be seen in future. Just approval doesn’t make successful merger. I want to see least amount of spectrum allotted for 2G from them by 2020 by completely vanishing 3G. If this happens I will say merger is successful.

Nikhil Mumbai-Pune
Nikhil Mumbai-Pune

Even after loosing customers(top end high ARPU customers) to Airtel and Jio in Mumbai and Pune respectively,they are doing nothing to offer them something special in offers. Let’s see what happens in next six months. I am hopeful for this to survive but everything looks bleak to my eyes.

mani
mani

Yesterday I noticed Airtel 4g speed has improved a lot in Lucknow I checked through network signal guru app they have now deployed 10mhz of band 3 spectrum previously they were using 5mhz of band 3 spectrum.
Till 2-3 days back I was getting 5-10 Mbps speed on Airtel 4g but since yesterday I am getting 18-25 Mbps speed constantly

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