When Galaxies Collide: Vodafone India and Idea Cellular Merge
Posted on: 21st March 2017
The merger between two of India’s largest mobile operators – Vodafone India and Idea Cellular – will create a new market leader for India, ahead of Bharti Airtel. But rationalising on such a scale will require a new level of analysis, decision-making and ultimately re-design.
The scale of the merger is reflected in the cost savings anticipated as a result. As reported in TelecomPaper, the combined operation will ultimately be $2 billion a year cheaper to run – represesenting a $10bn overall value to the business.
According to TelecomPaper, the major cost savings are expected to come from:
- rationalising network infrastructure
- generating operational efficiencies
- lower maintenance expenses
- savings in energy costs
- higher spectrum availability and larger single radio access network (RAN) deployment
- re-deployment of overlapping equipment from rationalised sites
As well as rationalising service centres, back office and IT systems, general and administration costs.
Delivering savings of that magnitude will be hugely complex. Obviously, there is a direct dependency on nature and quality of data held within OSS and adjacent support systems. But such systems were not built for such an exceptional event. The current data and systems are therefore unlikely to be able to provide the necessary answers. Instead, such a merger is likely to require new techniques to determine how to rationalize two entirely independently planned and built networks.
Normalizing data from different systems will be a critical starting point, but more important will be the ability to determine the optimal end configuration:
- which resources can be retired?
- which resources *should* be retired, from a cost-to-maintain, power consumption or regulatory perspective?
- how to minimize the impact of rationalization on current services?
- at each phase of network consolidation, where are the critical points of failure?
- how can freed-up resources be reorganized to maximise their revenue potential?
This merger may be a rare event. But with the scale involved, and billions of dollars at stake, innovating to solve the questions it raises would look entirely prudent.