Vodafone Introduction

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Vodafone Essar

VODAFONE ESSAR LIMITED

Type: Private

Founded: 1994as of Hutchison Essar

Headquarters: Mumbai, India

Key People: Asim Ghosh – M.D

Industry: Telecom

Products: Mobile Telecommunication operator

Website: Vodafone India

Vodafone Essar, previously Hutchison Essar is a cellular operator in India that covers 16 telecom circles in India. Despite the official name being Vodafone Essar, its products are simply branded Vodafone. It offers both prepaid and postpaid GSM cellular phone coverage throughout India and is especially strong in the major metros.

Vodafone Essar provides 2G services based on 900Mhz and 1800Mhz digital GSM technology, offering voice and data services in 16 of the country's 23 licence areas.

Ownership

Vodafone Essar is owned by Vodafone 52%, Essar Group 33%, and other Indian nationals, 15%.

On 11 February 2007, Vodafone agreed to acquire the controlling interest of 67% held by Li Ka Shing Holdings in Hutch-Essar for US$11.1 billion, pipping Reliance Communications, Hinduja Group, and Essar Group, which is the owner of the remaining 33%. The whole company was valued at USD 18.8 billion. The transaction closed on 8 May 2007.

Previous brands

In December 2006, Hutch Essar re-launched the "Hutch" brand nationwide, consolidating its services under a single identity. The Company entered into agreement with NTT DoCoMo to launch i-mode mobile Internet service in India during 2007. The company used to be named Hutchison Essar, reflecting the name of its previous owner, Hutchison. However, the brand was marketed as Hutch. After getting the necessary government approvals with regards to the acquisition of a majority by the Vodafone Group, the company was rebranded as Vodafone Essar. The marketing brand was officially changed to Vodafone on 20 September 2007. In Mumbai, it was earlier known by the name Orange, a brand that used to be marketed by its former owner, Hutchison. Still earlier it was known as Max Touch and AceTel even before that. The cellular service was best during the time of Orange, it got bad during Hutch and contrary to expectations it got worst after Vodafone took over. Apart from a pathetic network service, they are plunging new depths in terms of their promotional messages in Hindi. They are more interested in selling callertunes and ringtones. It’s been one year but we don't get a feel of using a world class telecom provider. On September 20, 2007 Hutch becomes Vodafone in one of the biggest brand transition exercises in recent times. Vodafone Essar is spending somewhere in the region of Rs 250 crores on this high-profile transition being unveiled today. Along with the transition, cheap cell phones have been launched in the Indian market under the Vodafone brand. There are plans to launch co-branded handsets sourced from global vendors as well. A popular daily quoted a Vodafone Essar director as saying that "the objective is to leverage Vodafone Group's global scale in bringing millions of low-cost handsets from across-the-world into India." While there is no revealing the prices of the low-cost Vodafone handsets, the industry is abuzz that prices might start at Rs 666, undercutting Reliance Communications' much-hyped 'Rang Barse' with cheap handsets beginning at Rs 777. Meanwhile, Vodafone Essar sources said there would be no discounts or subsidized handset offers -- rather handset-bundled schemes for customers. Incidentally, China's ZTE, which is looking to set-up a manufacturing unit in the country, is expected to provide several Vodafone handsets in India. Earlier this year, Vodafone penned a global low-cost handset procurement deal with ZTE.

Growth of Hutchison Essar (1992-2005)

In 1992 Hutchison Whampoa and its Indian business partner established a company that in 1994 was awarded a licence to provide mobile telecommunications services in Mumbai (formerly Bombay) and launched commercial service as Hutchison Max in November 1995. Analjit...
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