Competition in India's telco sector has intensified since Reliance Jio was launched into the market in September 2016, adding 52 million subscribers in its first three months of operation. A report by a UK newspaper indicated that Vodafone India and Idea Cellular were seeking a merging with Reliance Jio. But the story has been denied by sources in a report by the Hindustan Times.
The newspaper's sources said India's current spectrum holding limits and revenue market share caps both indicate that a merger is not likely. A source from Idea Cellular was also noted in the newspaper article as denying that the company was in talks with Reliance Jio.
Competition in India's telco sector has grown fierce since Reliance Jio entered the scene after it took a large share of the market from its competitors. The new provider of telecom services offered a range of attractive free services to customers to reel them in, which then lead to Reliance Jio's competitors '“ including Bharti Airtel, Vodafone and Idea Cellular '“ to reduce the price of their offerings to match.
Vodafone Group responded to the threat by investing in its India unit last year, which included a payment to reduce its debt and also increase its 4G spectrum holding at an October auction. The company announced in November that its revenues in India had increased in its fiscal H1 (which covers the period to end-March). Vodafone also confirmed its plans to proceed with an IPO of its Indian unit 'as soon as market conditions allow.'
