Birth of telecom giants: New pecking order can make battlefield more daunting for Reliance Jio

NEW DELHI: If Reliance Communications-Aircel, Tata Teleservices and MTS come together—as the latest buzz indicates—they can birth a giant that can frustrate new entrant Reliance Jio's plans to pitchfork itself into the telecom market on the back of freebies.

Indian telecom sector is moving towards major consolidation. Vodafone and Idea have already declared a merger.

If Reliance Communications-Aircel, Tata Teleservices and MTS merge, they could create a strong No. 3 telco behind the proposed Vodafone-Idea combine and Bharti Airtel.

The merger will alter the pecking order in the telecom sector.

Pecking order by subscriber base

1. Reliance Comm-Aircel, Tata Teles and MTS will have around 260 million subscribers

2. Airtel has 266 million users, as per regulatory data as of December 31.

3. Vodafone and Idea Cellular have 205 million and 190 million subscribers, respectively, adding up to 395 million in case of a merger.

4. Jio had over 72 million users as of December end.


Pecking order by revenue share

1. A Tata Tele-RCom-Aircel-MTS combine will have revenue market share of over 18%.

2. Airtel has 31% share.

3. Vodafone-Idea will have 42% market share (23% and 19%, respectively).

4. Jio has no revenue market share as it hasn’t started charging for its services.