What will Happen to Vodafone Idea

Leaving 5G aside, there are still a lot of things that the telco needs to do, including expanding 4G, bringing VoWi-Fi to more circles, getting new investors on board, paying off dues to the tower companies and banks, and getting the government to convert the dues into equity. All of this needs to happen for the telco to even be considered a strong competition to the other two private players.

Highlights

  • Vodafone Idea (Vi), the third-largest telecom operator in India, has been the talk of the town due to multiple reasons.
  • Vi can't rollout 5G right now.
  • Vodafone Idea needs investors onboard.

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Vodafone Idea 5G

Vodafone Idea (Vi), the third-largest telecom operator in India, has been the talk of the town due to multiple reasons. But all of these reasons revolve around the telco's inability to raise funds and boost business operations. While the CEO of the company doesn't believe there's any disadvantage in delaying the 5G rollout, there's a significant advantage to Airtel and Jio in rolling out 5G first as they can market it to get high-paying consumers in the short term.

What Vodafone Idea lacks right now isn't just liquid funds but the trust of the investors. There's just so much that needs to go right if the telco wants to make a strong comeback. There are no worries about the telco going out of business; that's not going to happen. But what indeed is a worry is how long it will keep taking losses before things can become right. While the quarterly revenues are growing along with the ARPU (average revenue per user) figure, the subscriber churn rate is also going up. The speed at which Vi is adding 4G subscribers is just not good enough to make any positive impact on the business.

Leaving 5G aside, there are still a lot of things that the telco needs to do, including expanding 4G, bringing VoWi-Fi to more circles, getting new investors on board, paying off dues to the tower companies and banks, and getting the government to convert the dues into equity. All of this needs to happen for the telco to even be considered a strong competition to the other two private players.

Vodafone Idea has some of the best mobile plans on offer, be it in the postpaid or prepaid segment. The telco is ramping up its hiring process and investing in marketing activities, but that's not going to solve the entire problem. Vi is in a particularly tough spot, and the management of the company has been feeling the heat for many years.

Vodafone Idea also revamped the postpaid offerings by introducing new Vi Max plans, which also include a new REDX plan with international travelling benefits and unlimited data.

The telco needs to sort out priorities and strategically looking; 5G is not one right now, unfortunately. For any business, like the popular Shark Tank, US investor Kevin O'Leary says, cash is king. Vodafone Idea needs to start generating free cash flow. It won't happen right away, but the right process and right approach from the management is required to turn things over. In case you are a Vodafone Idea investor, you should also read this - Vodafone Idea Investors, this is Something You Should Know

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