The telecom network operator will be facing competition from Reliance Jio Infocomm, Idea Cellular and Airtel in the 4G space. Airtel has rolled out 4G LTE network in more than 330 towns. Reliance Jio, according to telecom analysis reports, will be the market leader in the Indian 4G space. The pact between Jio and Reliance Communications will pose challenges in the voice market as well.
The following is the highlight of an interview with Vodafone India CEO published in financial daily Hindu BusinessLine.
Though Vodafone will be launching 4G LTE services in select towns, the company CEO is extremely cautious about its business plans because the overall 4G phones on its network was below 2 percent, whereas 3G phones were 26-27 percent.
Changing the current SIM card to 4G, lack of smartphone adoption and buying a new 4G phone are the main challenges in the mass adoption of 4G.
Sunil Sood is considering that the demand for 4G will be mainly happening in metros. That’s why Vodafone is launching 4G in select pockets of metros and top cities and not nationally. The plan of Reliance Jio is totally different. Idea Cellular has plans to roll out 4G in 600 towns in the first half of 2016.
Vodafone India CEO says OTT (over the top) companies are assisting Vodafone to generate revenues. The user has to pay the moment he gets a WhatsApp message, irrespective of whether he has read it or not. Incoming data is not free. Vodafone and other players make money from this data usage.
OTT is affecting some of its voice business, far more in the international long distance telephony business than the domestic business.
However, voice business of Vodafone India is growing in minutes. The overall growth in the industry is slowing down, but gradually. Vodafone India expects a percentage lower revenue in voice business in 2015 as compared with a year ago. The overall impact on voice is on the revenue side because of the fall in termination charges.
Vodafone is in talks with Tata Teleservices and other telecom network operators for a possible spectrum trading deal.