InvestorQ : What is the impact on telecom players like Bharti Airtel and Vodafone Idea of regular internet shutdowns by the government?
Deepa Salunkhe made post

What is the impact on telecom players like Bharti Airtel and Vodafone Idea of regular internet shutdowns by the government?

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Juvina Maggie answered.
2 years ago
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Actually, the impact of these consistent internet shutdowns on the mobile companies is much bigger than what most people had originally anticipated. It is estimated that Indian mobile operators like Bharti and Vodafone may be losing around Rs.2.45 crore in revenue every hour they are forced to suspend internet services on government orders. Government has been putting such restrictions in sensitive areas where there have been protests and demonstrations, especially in states like Karnataka, UP and the UT of J&K.

To quell protests, the government intermittently orders mobile data shutdowns to prevent people using social media such as Instagram and Tik-Tok to spread rumours. Such internet suspensions have been criticised by internet freedom activists. For example, even on 27 December, the mobile internet was ordered to be shut down in more than 18 districts in the state of Uttar Pradesh; which the telcos have to abide by. Now Delhi has also suspended internet services to avoid any unnecessary trouble.

India is one of the largest consumers of internet data and the internet penetration is growing in India at a rapid pace. Just to illustrate, Indians consume 9.8 gigabyte of data per month on their smart phones; the highest in the world. India has also emerged as the biggest market for social media firm Facebook, WhatsApp and Tik-Tok in terms of number of users. Such frequent internet shutdowns are certainly becoming a nightmare for telecom companies that are already under pressure due to falling margins and huge capital costs and penalties payable.

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