India’s leading GSM players Bharti Airtel, Vodafone Essar and Idea Cellular on Saturday announced the merger of their wireless infrastructure businesses in 16 circles to share 70,000 tower units and also form the world’s largest ‘independent’ tower company. Called Indus Towers Ltd, Bharti and Vodafone will each have a 42% equity in this infrastructure firm, while Idea Cellular will hold the remaining 16%, the telcos companies said in a joint statement.
Bharti and Vodafone will contribute 29,400 towers each to Indus with Idea bringing in 11,200 towers. Bharti Infratel, the hived off tower arm of Bharti Airtel will retain the company’s passive infrastructure in the remaining 7 telecom circles. Infratel will be left with about 20,000 after the creation of Indus.
The move will enable all three service providers to and increase efficiencies and reduce expansion costs. “The three companies will each merge their existing passive infrastructure assets in 16 telecom circles in India. Indus Towers will provide passive infrastructure services to all operators on a nondiscriminatory basis. Indus Towers will enable optimisation of future tower roll-out and enhanced operational efficiency leading to opex and capex savings for its customers,” the joint statement by the three service providers added.
The Indian consumer will benefit through improved network reach and quality, more choice and significantly greater access to mobile services across the country, the three telcos said. The three leading GSM operators also said that Indus Towers would provide them with significant scale benefits.
Even amidst fierce competition, all service providers in India, the world’s fastest growing mobile market, are working towards large scale sharing of passive infrastructure to cut down on expansion costs and keep tariffs low even as they extend their footprint to rural India. Lower capex and opex are key to offsetting the low usage from new subscriber additions beyond the large towns and cities.
India added over 8 million new wireless users in October, taking the country’s mobile subscriber base to over 217 million.
Economic Times
Also see: GTL Infrastructure the only listed company in the telecom tower infrastructure business in India
