The ball of Vodafone-Idea is now in Jio’s court.."Mr Birla has been writing distress letters every week for the last two to three months. Sooner or later, this (leak) had to happen." That’s how an official in the Department of Telecom (DoT) described the Vodafone-Idea, or Vi, chairman’s letter to the government seeking “immediate active support” which was leaked to the media last week. Executives within Vi are not happy with the leak and believe the company hasn’t shown any signs of shutting down soon, as indicated in the letter. But both DoT and Vi would know that since 2019, Vi has been suggesting to the government that it convert the telco’s debt into equity. Indian telecom is full of palace intrigue. A lot of regulatory decisions in the recent past made little sense. Mercifully, many sources confirmed with Mumbai Multimedia Studio that the Govt. is working on a relief package to improve the overall health of the sector. Among other things, it’s not going to include one of the core demands made by Vi—floor pricing.
In the past, all telcos have lobbied for floor pricing. Now, though, it’s seen as “cartelisation by fiat’ within the government. That leaves a tariff hike by all telcos as the only real (and reasonable) option to improve the financial health of the industry. Something which Reliance Jio is opposed to Sources inform us, the author of today's story, that the country’s top political leadership is nudging Jio to agree to a tariff hike. As always, back channel talks are complicated. India’s largest telco will expect something in return. A reduction in 5G spectrum prices? Even then, Jio, which is expected to be the cash-generating buddy for the group’s newer digital businesses, is faced with a huge dilemma. All told, three schools of thought are actively being promoted in the power corridors. They include a Satyam-like face-saving and a Schumpeterian creative destruction.
This is a great inspiring article.I am pretty much pleased with your good work.You put really very helpful information... roof