Veteran telecom company Vodafone Idea and cloud communications firm Tanla Platforms are poised to end their collaboration due to financial challenges.
Tanla Platforms has announced that it will not continue its partnership with Vodafone Idea beyond November.
The agreement, which was initiated in November 2021 to facilitate secure and encrypted international messaging traffic, was originally set for a two-year term.
However, Tanla has decided to suspend any potential renewal for now, as indicated in its regulatory filing.
Impact on Tanla’s Financials
Tanla’s decision to conclude its deal with Vodafone Idea will have significant financial implications.
The telecom solutions provider initially engaged with Vodafone Idea to offer platform and firewall services for international A2P (application-to-person) services.
Unfortunately, the discontinuation of this partnership is projected to result in a quarterly loss of Rs 17 crore in revenue and Rs 9 crore in profit for Tanla after November.
Transitioning Services: Vodafone Idea’s Next Steps
Following the impending separation between Vodafone Idea and Tanla after November, Route Mobile has already stepped forward to announce its agreement with Vodafone Idea.
Under this arrangement, Route Mobile will assume responsibility for delivering A2P monetization solutions for all A2P SMS traffic within the telecom network.
Challenges for Vodafone Idea
Vodafone Idea continues to face challenges in its financial landscape.
The company’s net debt stood at Rs 2.09 lakh crore at the close of FY 2023.
It has a loan of Rs 11,390 crore from banks and financial institutions, with Rs 8,380.4 crore scheduled for repayment by March 31, 2024.
Furthermore, the company’s financial performance for the June quarter reported a net loss of Rs 7,840 crore, marking an increase from the previous year’s Rs 7,295.7 crore loss and the previous quarter’s Rs 6,418.9 crore loss.
However, a glimmer of hope emerged on August 14 when the company disclosed that its promoter group entity has pledged support of Rs 2,000 crore in case of liabilities.
Notably, the identity of this entity was not disclosed by Vodafone Idea.
