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Multinational telco Vodafone has made a major statement of intent by funneling around $7 billion into its Indian operations to fund the anticipated war of attrition.

Scott Bicheno

September 23, 2016

2 Min Read
Vodafone boosts Indian war chest for Jio fight

Multinational telco Vodafone has made a major statement of intent by funnelling around $7 billion into its Indian operations to fund the anticipated war of attriction.

It has only been three weeks since upstart Indian MNO Jio revealed a set of tariffs and extras designed to pull the rug out from under the incumbents. According to Ovum’s WCIS service Vodafone is the second biggest player in the Indian mobile market, behind Bharti Airtel, with a 19% share of subscribers.

Within days two major operators – Reliance and Aircel – decided to pool their resources for the impending commercial bloodbath, while market leader Airtel seems to have resorted to dilly-dallying over point-of-interconnect to obstruct the Jio juggernaut.

Vodafone has so far kept quiet on the matter but recently announced an infusion of around $7.2 billion from Newbury to its Indian operations. There are plenty of demands on that cash from heavily indebted Vodafone India, including another pricey spectrum auction, ongoing 4G network upgrades and the price war catalysed by Jio.

“This equity infusion of INR 47,700 crore, which we believe is the largest ever in India, will enable Vodafone India to continue its investments in spectrum and expansion of networks across various technology layers delivering the best of experience to our hundreds of million customers,” said Sunil Sood, CEO of Vodafone India.

Even this massive wad of cash may prove to be insufficient as Vodafone India’s debt alone is almost twice that amount and Jio is owned by India’s richest man, who has already dropped billions on spectrum alone and shows no sign of letting up on the spending spree. The word on the street is that Vodafone wants to be the most aggressive bidder in the next spectrum auction but Jio might have something to say about that.

About the Author(s)

Scott Bicheno

As the Editorial Director of Telecoms.com, Scott oversees all editorial activity on the site and also manages the Telecoms.com Intelligence arm, which focuses on analysis and bespoke content.
Scott has been covering the mobile phone and broader technology industries for over ten years. Prior to Telecoms.com Scott was the primary smartphone specialist at industry analyst Strategy Analytics’. Before that Scott was a technology journalist, covering the PC and telecoms sectors from a business perspective.
Follow him @scottbicheno

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