Duopoly risk in the telecommunications sector higher than before: analyst – latest news

<pre><pre>Duopoly risk in the telecommunications sector higher than before: analyst - latest news
Since the Supreme Court on Friday adopted a firm vision of the breach of its order on the payment of legal fees by telecommunications companies, the situation of Vodafone Idea is "particularly vulnerable,quot; and the risk of duopoly in the sector is greater than before, according to an analyst "There is no doubt that this is bad news for the telecommunications industry. It makes the situation of Vodafone Idea particularly vulnerable, even more than it was," said Mahesh Uppal, director of the consultant Com First India.

He also said that the risk of a duopoly in the telecommunications sector is higher than before.

Currently, there are three private players in the Indian mobile market: Bharti Airtel, Vodafone Idea and Reliance Jio, as well as state operators BSNL / MTNL.


Uppal said the room for maneuver is now smaller for operators, but added that if the government considers the situation a long-term problem, it could consider a change in policy.

"But (what happened today) was not unexpected to see SC's position in the last 2-3 hearings … given its previous position that the operators had signed a license agreement and, therefore, were required to pay. Therefore, it was unlikely that there would have been any dilution in that position, "Uppal said.

The Supreme Court on Friday ordered the managing directors and directors of telecommunications companies and other companies to explain why no contempt measures are taken against them for breach of their order to pay adjusted gross income (AGR) of Rs 1.47 lakh crore al Department of Telecommunications

Noting the breach of his order, a bank of Judge Arun Mishra, Judge S Abdul Nazeer and Judge M R Shah expressed anguish over the order approved by the DoT desk officer, maintaining the effect of his verdict on AGR.

"We don't know who is creating this nonsense. Is there no law left in the country … It is better not to live in this country and rather to leave the country," the bank observed.

In total, up to 15 entities owe the government Rs 1.47 lakh crore – Rs 92,642 crore in unpaid license fees and other Rs 55,054 crore in charges for pending spectrum use.

These quotas arose after the Supreme Court, in October last year, confirmed the government's position on the inclusion of non-core business income in the calculation of the annual adjusted gross income (AGR) of telecommunications companies, a part of which is paid as a license and spectrum fee to the treasure.

VIL faces the fees of Rs 53,000 million rupees that are expected to pay the government: its obligations add up to Rs 24,729 million rupees of spectrum fees and other Rs 28,309 million rupees in the license fee, and the company He had warned before a closure if no relief was given.

Vodafone Idea in its earnings statement on Thursday had issued warnings about "material uncertainty,quot; throwing "significant doubts,quot; about its ability to continue as an ongoing business.

The company's ability to continue as a functioning company depends essentially on a positive outcome of its request for modification in the Supreme Court on the AGR issue and any relief from the telecommunications department in payments, VIL said Thursday.

Last week, Vodafone executive director Nick Read said the situation in India is critical, following the ruling by the United States Supreme Court. The British telecommunications company owns a 45.39 percent stake in VIL.

The obligations of rival Bharti Airtel totaled nearly Rs 35,586 million, including license fees and spectrum usage fees. Airtel had recently said that the material uncertainty mentioned above about the group's ability to continue as a running business "no longer exists,quot; after the recent fundraising in crore of Rs 21.502.

Most of the remaining responsibility corresponds to state-owned BSNL / MTNL and some of the closed / bankrupt telecommunications companies.


Please enter your comment!
Please enter your name here