Featured Story
Intel and telcos left in virtual RAN limbo by rise of AI RAN
A multitude of general-purpose and specialist silicon options now confronts the world's 5G community, while Intel's future in telecom remains uncertain.
Vodafone and Idea Cellular are reported to be in talks about a potential merger of their operations.
In what could lead to one of the biggest-ever M&A deals in the Indian telecom market, Vodafone and Idea Cellular, the country's second- and third-largest operators, are said to be exploring merger options, according to local press reports.
While Idea Cellular Ltd. has denied the possibility of a merger with Vodafone India , the latter has declined to comment on the speculation, according to these reports. But if a merger did come about, it might dethrone Bharti Airtel Ltd. (Mumbai: BHARTIARTL) as the country's biggest service provider. At the end of May, Airtel had a total of 254 million subscribers, while Vodafone and Idea had 198 million and 175 million subscribers respectively, according to data released by the Telecom Regulatory Authority of India (TRAI) .
Bharti Airtel would remain the biggest operator in terms of sales, however. In the financial year ending March 2016, Vodafone and Idea generated revenues of $6.6 billion and $5.4 billion respectively. Airtel, by comparison, made sales of about $14.4 billion in its last financial year.
India's telecom industry is intensely competitive, which has led to extremely low average revenue per user for the country's players. With the arrival of 4G operator Reliance Jio , the conditions are ripe for further consolidation. This year has already seen Bharti Airtel acquire spectrum licenses from smaller players Aircel Ltd. and Videocon Telecommunications Ltd. , while Reliance Communications, the number-four player, acquired MTS India, the only pure-play CDMA operator, in 2015. (See Airtel Acquires Videocon's 1800MHz Spectrum and MTS India Merges With RCom.)
Want to know more about 4G LTE? Check out our dedicated 4G LTE content channel here on Light Reading.
The industry is also abuzz with talks of a merger between Tata Teleservices Ltd. and the Indian subsidiary of Norway's Telenor Group (Nasdaq: TELN), while Vodafone itself was believed to be in talks to acquire Tata Teleservices until recently. Its limited 4G spectrum holdings could explain its interest in exploring takeover opportunities.
However, current regulations will create a number of difficulties for the proposed merger between Vodafone and Idea. The rules stipulate that the merged entity should not have a market share of more than 50% in any given circle or service area. Vodafone and Idea Cellular would together exceed this threshold in some circles.
– Gagandeep Kaur, contributing editor, special to Light Reading
Read more about:
AsiaYou May Also Like