China Mobile Reportedly Seeks Tie Up With Airtel & Vodafone Idea
The leading Chinese telecom operator is looking to invest in different markets and India could be its next stop.
In an interesting development this week, one of China’s biggest telecom operators, China Mobile is reportedly talking to Indian telcos Airtel and Vodafone Idea Limited to make an entry into the Indian market.
The telco, according to this Livemint report, has held early stage talks with both the Indian telcos in order to jointly develop a cloud network in the country. The report, quoting multiple sources, suggests China Mobile is keen to enter the country and come as a holding company in either one of these telcos, or even both of them if that’s possible.
As a holding company, China Mobile will have enough power to have a say in policy making as well as management decisions but it cannot be active in day-to-day business operations.
The sources highlight that China Mobile, with over 900 million mobile customers in its home market, is now scouting for other countries, where it could expand its base and partnering with local telecom players is the best possible way forward for the company.
To make this happen, China Mobile created the China Mobile Investment Holdings Co. Ltd in 2016 which looks into such opportunities for its telco arm. If the talks come to fruition, both Airtel and Vodafone Idea could benefit from added financial power, courtesy China Mobile.
With Reliance Jio now leading the telecom space, and soon expected to become a pivotal player in the broadband sector as well, both Airtel and Vodafone Idea could use added financial muscle, in addition to what they have been investing in the country.
Having said that, developing a cloud network with a Chinese operator could raise concerns for India’s government, which already looking to promote local players and prevent global players from taking too much market share in the country.
For now, it remains to be seen if China Mobile finds the right ally in either of these two telcos, and if so, how it plans to establish its business with them.
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