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Vodafone Idea bankruptcy to hit 2G users hard

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Indian telecom operator Vodafone Idea (Vi) 2G subscribers would be the most affected if the company’s financial state remains unsolved, a source close to the matter told ET Telecom.  

In this case, Vi’s local rivals Reliance Jio and Bharti Airtel will have to facilitate alternative options for Vi’s 2G customers. 

Experts highlighted that these solutions include providing low-end 4G smartphones or 4G feature phones to Vodafone Idea’s low-end 2G customers. 

Vi refused earlier last week to file for voluntary bankruptcy claiming that such a move may indicate that the company was to blame for its operational failure and consequent financial crisis, which was not the case.   

In the meantime, Vi submitted a review petition to the Supreme Court this week seeking a review of the July 23rd order dismissing requests of telcos for re-computation of adjusted gross revenue (AGR) dues. 

The beleaguered company in its review petition has said that if it goes bankrupt then over 270 million subscribers will be left high and dry. 

Vi has 119 million wireless broadband or 3G and 4G subscribers, which means the rest are 2G subscribers. 

“Airtel will increase prices if Vi closes down so that only those who can afford the service come to its network,” explained an industry analyst who asked to keep his identity anonymous. 

“A lot of 2G customers, typically daily wagers, use low quality phones, which impacts the network quality. Airtel might not want that,” the spokesperson added. 

Jio is considered as Vi’s 2G subscribers second option. However, the source claimed that if customers chose Jio they will have to consider buying a new phone, an option that might not be feasible for most of them.  

The source pointed out that Vi’s subscribers still have state-0wned telecom service provider BSNL as an option. 

In case Vi ceases to exist in the market, Jio and Airtel will need to facilitate low end 4G handsets or 4G feature phones, Ashwinder Sethi, principal at Analysys Mason, U.K.-based telecom and media consultancy firm, told ET Telecom. 

Additionally, both companies need to offer handset subsidies to enable these users to afford a 4G handset, Sethi added. 

Despite Vi’s financial struggle and whether it will continue to operate in the market or not, Telecom Regulatory Authority of India (TRAI) must guarantee that all Vi users be treated equally.  

“I do hope that TRAI, which has a responsibility for consumer protection, will be especially vigilant. It should ensure that 2G users can port or upgrade conveniently and affordably,” Mahesh Uppal, a telecom analyst noted to ET Telecom.  

Hala is a journalist and an editor with experience in the news industry. She enjoys writing motivational stories aiming to inspire people to overachieve.

Telecoms

India’s Reliance Industries seek controlling stake in UK’s BT Group

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Indian conglomerate Reliance Industries Ltd. (RIL) is assessing the possibility of bidding on British telecom titan, BT Group Plc., reported by the Economic Times.

According to the report published by the news hub on Monday, Reliance is currently planning to place an unsought offer to obtain shares into the British telco, or as an alternative, to have a controlling stake in the company. From the 419 institutional investors in the British firm, some have expressed their interest in cashing out if a suitable offer surfaces.

In parallel, Reliance is considering proposing a partnership with BT’s fiber-optic firm, Openreach, to finance and expand its plans.

Currently, BT Group’s market gap has reached a whopping $20.63 billion since November 26th. In the event of RIL taking control of the UK company, it will mark the biggest outbound merger and acquisition (M&A) related to any Indian establishment.

An outbound M&A is when a domestic company obtains or merges with a different firm in a different country. This demands notable guidance concerning the legality and issues of compliance to accommodate the other country’s demands, restrictions, and requirements to be included in the pre-merger interactions.

Analysts believe that Asia’s wealthiest man, Chairman and managing director at RIL, Mukesh Ambani, has directed his attention towards BT to further expand the company’s reach on a global scale.

It is worth mentioning that this does not mark the first time Reliance has tried to reach out for global expansion. In September, the Indian Group was outbid by a consortium of Apax and Warburg Pincus to obtain power over Netherland’s T-Mobile.

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Palestine to finally receive 4G rollout, agreement to be settled

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Israel has finally agreed to authorize 4G rollout to Palestine, as its latest initiative from the Israeli government to enhance Palestinian daily life.

While the country has already deployed 5G networks to its areas, Palestinian citizens have yet to indulge in the 4G rollout experience, as Palestinian telcos are still operating their services with 3G.

Following a closed meeting held between Israel and Palestinian telecoms, and repetitive complaints from Palestinian officials that Israel has not shown initiative to begin technical discussions until April.

Despite that no official agreement has been made, Palestinian telcos are waiting for clarification regarding the extent of bandwidth to be available, given that a previous Israeli agreement has been rejected by the telcos since Israel offered to provide a modest number of frequencies.

Even if Israel authorizes the agreement, local telecom operators will still need around six months to a year to purchase and import the required equipment for the 4G rollout in rural areas.

In 2018, the Israeli government agreed on the deployment of a 3G network for Palestinian citizens. However, the rollout was confined to the West Bank, given that Israel has not permitted domestic service providers to buy 3G equipment for Gaza, which is still operating on 2G.

The demand has risen from Palestinian to attain 4G networks, as it will heighten the country’s economy, as well as push residents from using Israel cellular networks and focus on local ones instead.

It is worth mentioning that Israeli networks deliver a much higher signal frequency reaching deep into Palestine’s region, in addition to their low-cost effectiveness and faster networks compared to the local ones.

This could potentially raise havoc for Palestine’s telcos as their pricing is too high, a factor led by Israel’s intense restrictions on network frequencies and limitations on towers infrastructure and location.

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Huawei to boost Malaysia digitization through new innovation center

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In an effort to boost Malaysia’s digitization, Chinese telecom giant Huawei seeks to accelerate the country’s digital economy transformation by building the country into a regional digital hub, Huawei said in a press release on Tuesday.

The company unveiled its newly refurbished and upgraded Huawei Customer Solution Innovation Center (CSIC) as part of a commemoration ceremony celebrating its 20th anniversary since entering the Malaysian market, the release noted.

Malaysia Prime Minister, Dato’ Sri Ismail Sabri Bin Yaakob said, “The CSIC is a testament to Huawei Malaysia’s commitment to the nation’s digital transformation.”

I was informed that most of Huawei Malaysia’s employees are local. Talents are a crucial part in accelerating digital transformation for the nation, he said.

The Prime Minister added that he believes that Malaysia has the capacity and capability to achieve 100 percent digital inclusivity, especially among vulnerable communities.

“I am proud to say, in embracing the concept of Keluarga Malaysia, Huawei has taken an important role in helping the Government address this matter. I hope more corporations will come forward to follow in your footsteps,” he said.

As such, Huawei’s CSIC was designed as an Information and Communications Technology (ICT) Hub and Centre of Excellence to run the industry’s open ecosystem and accelerate digital economy transformation in Malaysia.

The CSIC, which is located in Integra Tower at the heart of Kuala Lumpur, aggregates the company’s over 120 reference applications and services globally.

Huawei’s customers and partners can leverage this innovative platform to design and test technology solutions, verify new business models, and nurture innovation applications and services to both the public and private sectors.

Huawei Malaysia CEO Michael Yuan said that through the CSIC, Huawei Malaysia would continue to bring global experiences to serve the needs of the ICT industry in Malaysia and to assist local stakeholders in succeeding in their businesses.

“This center will act as a catalyst to accelerate Malaysia’s digital transformation and to capitalise on the potential of advanced technologies and assist in driving investments in the digital economy for the nation at the same time,” added Yuan.

Cloud Computing was another highlight, with Huawei working with Malaysian communication service provider Telekom Malaysia on their Alpha Edge, the only Malaysian-owned Cloud and AI infrastructure and services to enterprises and government institutions that ensures data sovereignty.

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