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Vodafone-Idea merger impact on subscribers

To counter Mukesh Ambani’s Jio and other major telecom-sector operators, British telecom major Vodafone has made plans to merge with…

Vodafone-Idea merger impact on subscribers

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To counter Mukesh Ambani’s Jio and other major telecom-sector operators, British telecom major Vodafone has made plans to merge with India’s Idea Cellular and create a new telecom giant. The partnership, which empower them to create the biggest telecom company in Indian will not only cut costs or facilitate operations but also impact the subscribers.

“I think the merger will bring down my data charges” a Vodafone subscriber said. “I will get good facilities after the merger,” another Idea subscriber highlighted. However, a subscriber said she “don’t think this it will change anything”.

Although it is very early to dream a bigger change, some experts believe the merger will help the merged company to cater their subscribers well. The merger will complete by the end of 2018 and after the merger both Vodafone and Idea will not exist, instead the new entity with a different name will emerge. The likely impacts on the subscribers are:

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Immediate impact

In the near future, there will be no impact on the subscribers of both the companies as the merger will take around two years. It can be expected that both the companies will continue to operate the way they do right now.

Coverage impact

Once the merger is completed, the new entity will give good network coverage pan India. The merger will result in “largest Indian telecom operator with widest mobile network in the country and pan India 3G/4G footprint,” a press statement by Idea says. Vodafone has strong presence in metro cities but Idea holds the leadership in semi urban and rural areas, according to the company statement. The merger will allow the companies to enhance customer services and compete more effectively.

Data charges

In the fast-growing digital world, lowering data charges is a problheadache for the service providers as well as the subscribers. Rationalising network infrastructure, generating operational efficiency, lower maintenance expenses and savings in energy cost will give the merged entity and opportunity to cut expenses. When company’s expenses will go down there are chances that the end customers will get benefits.

Benefits for the country

Talking about Indian digital missions, Idea stated the merger will accelerate expansion of wireless broadband network and the “Acceleration of expansion of wireless broadband networks across India will deliver the government of India’s ‘Digital India’ mission”.

Whether we talk about “Digital India Mission”, “Clean India Mission” or initiatives to promote cashless economy, without supportive technology it is not possible to compete with world players.

The country needs strong and competitive telecom majors for sustainable growth.

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