First round of talks between Ericsson and RCom have been inconclusive, with the Swedish equipment maker sticking to its stand on dragging the firm through a bankruptcy process if dues not paid.
The move to tap higher revenue comes amidst a bruising price war triggered by Jio’s entry in September last year, which has been hurting revenues and profits in the sector.
With IUC revenue stream drying up, companies will have to switch to VoLTE and unveil bundled offers to counter Reliance Jio threat.
JioPhone’s entry has brought some of the focus back to feature phones. The Reliance phone comes effectively free of cost to the consumer.
Large scale investments will be needed to manage large voice and data volumes as 1.4 billion SIMs consolidate with only 4-5 operators, Idea said in an investor presentation.
Jio had earlier said that it aims to deliver 100-150 million phones in the next six months (five million a week), but was bracing for competition from other feature phone makers as well.
The CCI ordered the probe in May, saying that there was prima facie evidence of the top three carriers forming a cartel to deny Jio adequate points of interconnection.
A bench comprising Justices Anoop V Mohta and Bharti Harish Dangre ruled that the CCI had no jurisdiction to order a probe into the matter.
Ericsson said it expected Rs 550 crore to be paid upfront because RCom had promised them that amount in different stages of the process but failed to live up to it.
Earnings before interest, depreciation, tax and amortisation (EBIDTA) of Airtel and Idea Cellular will be hit by 4-7% in FY19 and up to 8-12% .
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