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Tata Teleservices to merge with the Bharti Airtel making it the largest Teleservices Company

This year Tata Teleservices decided to merge with Bharti Airtel making Bharti Airtel the biggest service provider in the business. Bharti Airtel is paying Rs 1,500 crore of spectrum fees to acquire Tata Teleservices, its consumer base in 19 circle and its employees. After a list of wrong decisions and wrong technology choices by Tata Teleservices, it was time for Tata to close its business. Till date, Tata has never completely shut down its company and to avoid that the decision was made to merge with Bharti Airtel.

BATATA was a joint venture of Tata, Aditya Birla group, and AT&T. AT&T sold its 30 percent stake. The cellular network is called Idea. Since there is a conflict of interest because of Tata having both Tata Teleservices and Idea, there is about to be a lot of problems because of the rule guidelines. Birla’s took legal action to remove Tata from their stakeholders, and after a huge legal battle Tata was forced to sell their 48.12 percent stakes

Tata always believed that CDMA network will be the future of the cellular network business and have always concentrated on developing the technology. With Idea, Tata would have been the biggest player in the cellular business but Tata top management failed to realize that, and they are regretting their decision. The whole global market of CDMA is receding, and even big dogs like Qualcomm has realized that and are working on new technologies. In 2008 the game of telecom changed totally when the government declared that a telecom company could run bot CDMA network and GSM network with a single license. After the decision was made Tata merged with Japanese giant NTT DoCoMo and launched Tata DoCoMo. This also made other small companies to launch their network like Telenor, Sistema, and Videocon which decreased the profitability of Tata.

Tata’s realized that their business was not profitable and therefore they made an attempt to sell their business to Aircel and then to Vodafone which was not successful. Tata launched their 3G services in 2010 ahead of everyone but was not able to profit from that with some wrong decisions. NTT DoCoMo wanted to get out of business with Tata, and they took legal action against Tata and Tata was finally forced to pay off NTT DoCoMo.

Tata Teleservices was not a successful business for the Tata Group. Tata launched their 3G before everyone in the market but was not able to take an advantage. After Reliance launched Jio it was time for Tata Teleservices to back off.