Idea Vodafone merger has already made huge buzz in the Telecom industry. However, the impact of the merger can be huge and changing for the telecom space. So, there are few things that should be very well understood.
The idea Vodafone merger will be completed in coming 24 months. However, both of the brand would continue to work independently. However, there should be a merged entity for the brands even in the stock exchange. The merged entity shall have 26 % of idea share and around 45.1% of Vodafone. However, the rest of the amount would be held by Public. The prime obstacle of the deal, the arbitration between Vodafone and Government of India has nothing to do with the merger confirmed the Vodafone CEO, Vittorio Colao. Kumar Mangalam Birla will be the CEO of the merged entity.
However, it is more interesting to understand that what does this merger offer. Here are the few things that can change the Telecom market after the merger.
The telcos are having run for money ever since the Jio has launched. However, once the free service Jio ends on March 31, the competitive pricing and cost war will hit the industry yet again and Idea Vodafone together can make it fierce.
The mobile data has become the new war and the merged entity would look for the 4G and 5G data. This could change the space all together. However, the infrastructure may create a problem in immediate time. But with the reach and customer base of the both the Telcos, one should not be very skeptical.
The broadband service should get even better with the merger. However, there has not been any announcement so far but the Idea Vodafone deal can open new doors.
The Payment Banking is the new future for the Telecom companies as many of them already jumped in. The total customer base of the entity would be well above 400 million and they would like to offer high benefits for the payment banking.
It may be the time for new change in the Indian Telecom Space.