Airtel and Jio will fill the vacuum if Vodafone Idea leaves India
The Indian telecommunications industry has been witnessing a great deal of upheaval in recent years, with the arrival of 5G services shaking up the market. Airtel and Reliance Jio have been aggressively expanding their 5G coverage across the country, while the third-largest player, Vodafone Idea, has been struggling to keep up.
Despite buying spectrum in the 3.3-3.67 GHz and 26 GHz bands in the auction, Vodafone Idea has no plans to launch 5G services any time soon and is still delivering 4G services to its customers. This has put the company at a significant disadvantage, as Airtel and Jio have been introducing new offers and benefits to their customers, rapidly expanding their 5G coverage in new cities.
The financial struggles faced by Vodafone Idea have only compounded its problems, with the operator unable to invest in the necessary infrastructure upgrades to compete with its rivals. The absence of tariff hikes has made matters worse, as the company has been unable to raise the funds it needs to make these investments.
As a result, there are concerns that Vodafone Idea may be forced to shut down its operations entirely. Without the necessary tariff hikes, the company will be unable to make the necessary investments in its 5G network and may be unable to compete with Airtel and Jio in the long term.
According to a report by Kotak Institutional Equities, a delayed tariff hike would hurt Vodafone Idea’s survival hopes the most, and could effectively lead to a duopoly in the Indian telecom market. This would likely result in accelerated market share gains for Airtel and Reliance Jio, leaving Vodafone Idea out in the cold.
The financial crisis facing Vodafone Idea has also led to the company being unable to pay its spectrum charges to the Department of Telecommunications and has left it in significant debt to tower owners. This could lead to the termination of services, further compounding the company’s problems.
Conclusion
In conclusion, the Indian telecom industry is currently in a state of flux, with Airtel and Jio rapidly expanding their 5G coverage and introducing new offers and benefits to their customers. Vodafone Idea, on the other hand, is struggling to keep up and is facing significant financial challenges that could force it to shut down its operations entirely. Whether the industry will become a duopoly going forward remains to be seen, but it is clear that Vodafone Idea is facing an uphill battle to survive in the current market.
