NEW DELHI : Vodafone Idea Ltd, which operates two mobile service brands Vodafone and Idea in the country, will now offer postpaid services only under the Vodafone brand, with an aim to streamline this segment to one platform.
“All postpaid products and services will be exclusively offered to customers under the premium and aspirational brand Vodafone RED. Beginning with Mumbai, this initiative will be rolled out in a phased manner to cover all circles over the next few months," the company said.
The strategy will also help bring down marketing and general expenses for the debt-laden telecom company which posted a loss of ₹50,922 crore in the September quarter.
While all new postpaid customers will be on-boarded directly to Vodafone RED plans, all existing customers of Idea Nirvana, the postpaid offering under the Idea brand, will be migrated to similar Vodafone RED plans.
There would be no change in pricing. To be sure, postpaid customers comprise only 5% of the market in India, which predominately remains a prepaid market.
Vodafone Idea has a total 311.1 million users as of September end.
Prepaid products will continue to be offered under both Vodafone and Idea brands nationally across all circles via respective retail and digital channels, the company said.
The announcement comes a day after UK-based Vodafone Group Plc said that the outlook for Vodafone Idea Ltd, its telecom joint venture with the Aditya Birla group in India, remains critical and the company is seeking relief from the Indian government.
“In October, the Supreme Court gave an adverse judgement in the adjusted gross revenue (AGR) case against the industry. The outlook for Vodafone Idea remains critical," Vodafone Group said in a statement announcing its December quarter earnings on Wednesday.
“The company is actively seeking various forms of relief from the Indian government to ensure that the rate and level of payments it makes to the Indian government is sustainable and it can meet its other commitments as they fall due," it added.
The 24 October court order that ended a 14-year legal battle between telcos and the department of telecommunications (DoT) asked India’s top wireless carriers to cough up more than ₹1 trillion in dues, straining their already precarious financial situation.
Telecom operators had challenged the method adopted by the department of telecommunications to calculate AGR. Licence and spectrum charges are calculated at 8% and 3-5% of AGR, respectively.
While the telcos said AGR refers only to revenues from telecom, DoT insisted that it includes all revenues.
The Supreme Court upheld the government’s definition of adjusted gross revenue and asked operators to pay past dues by 24 January.
Airtel owes ₹35,586 crore to DoT, Vodafone Idea over ₹50,000 crore, and Tata Teleservices, which has sold its mobile services business to Airtel, owes ₹14,000 crore.
