Vodafone Current Affairs - 2019
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Vodafone Idea Ltd: Idea Cellular and Vodafone completes merger to create India’s largest telecom operator
The merger of Idea Cellular and Vodafone India has been completed after it was cleared by National Company Law Tribunal (NCLT). This merger has created India’s biggest telecom service provider. The merged entity is named Vodafone Idea Ltd and dislodges current market leader Bharti Airtel from top position, by its sheer size and scale. New board has been constituted for merged entity with 12 directors (including six independent directors) and Kumar Mangalam Birla as its Chairman.
The combined entity will have nearly 443 million customers surpassing Bharti Airtel’s 344 million users. Moreover, it will have all-India revenue market share of 32.2% and take numero uno slot in nine telecom circles. It will have broadband network of 3.4 lakh sites and distribution network with 17 lakh retail outlets.
The combination will have wide spectrum portfolio of about 1,850 MHz, over 2 lakh mobile sites and about 2.35 lakh kms of fibre network. This will allow merged entity to offer superior voice and broadband connectivity across the country, covering 92% of the population and reaching nearly 5,00,000 towns and villages.
Telecom Regulator Telecom Regulatory Authority of India (TRAI) has recommended Department of Telecom (DoT) to impose combined penalty of 3,050 crore rupees on Bharti Airtel, Vodafone and Idea cellular.
It had mentioned that the penalty should be imposed on these telecom companies for allegedly denying interconnectivity to newcomer Reliance Jio.
What is the issue?
- The Reliance Jio had alleged that due to inadequate interconnection points its subscribers were unable to make calls to other networks.
- TRAI has found that these three companies have violated licence norms by denying adequate interconnection points to Reliance Jio Infocomm.
- Their combined actions have stifled the competition and are seen as anti-consumer and against public interest.
Now the DoT will decide on next course of action. If DoT finds violations of norms in all circles as mentioned by TRAI, these three telcos will be imposed combined penalty of Rs 3,050 crore.
About Telecom Regulatory Authority of India (TRAI)
- The TRAI is an independent regulator of the telecommunications business in India. It came into existence by the Act of the Parliament in 1997.
- It was established in wake of entry of private sector in telecom industries after Government had constituted the National Telecom Policy (NTP) to attract domestic and FDI investment in the telecommunication sector.
- Its main purpose is to deliver a fair and transparent environment for fair competition in telecom market. TRAI also fixes or revises the tariffs for telecom services in India.