Vodafone Idea partners with IBM in $600 mn deal to modernise its IT systems

Vodafone Idea (Vi) has entered into a strategic partnership with technology major IBM to modernise its IT systems, strengthen operations, and accelerate digital initiatives by leveraging artificial intelligence (AI) and automation. The multi-year deal of $600 million is aimed at overhauling its IT systems and integrating AI and automation into telecom operations. 

Rishi Aurora, Managing Partner, IBM Consulting India & South Asia, said, “The collaboration extends the companies’ 17-year relationship.” 
This new agreement, which replaces their older $800-million contract, which expired in April 2024, is Vi's move to cut costs and stay competitive as it faces financial pressure. That said, IBM is now bringing Kyndryl on board as part of the new deal.

The companies will use AI and automation to improve its operations, speed up digital services and enhance customer experience. As part of the deal, the two companies have set up an AI Innovation Hub. The hub will bring together experts from both companies to create AI-driven tools, automation solutions and digital products. It will also work with Vi’s newly unified DevOps team to make software development faster and more efficient.

Vi expects the partnership to shorten time-to-market, enhance resilience of its IT ecosystem, and deliver seamless digital experiences to its customers. “Our collaboration with IBM marks a pivotal milestone in Vi’s digital journey. It reflects our commitment to AI-led innovation and our ambition to drive accelerated growth through intelligent decision-making and automation,” said Jagbir Singh, Chief Technology Officer, Vodafone Idea Limited.

Through IBM Consulting’s expertise in AI, DevOps, and its global partner ecosystem, Vi aims to sharpen IT agility, improve customer experiences, and unlock new revenue opportunities.

Juhi McClelland, Managing Partner, IBM Consulting, IBM Asia Pacific, said the partnership comes at a crucial time for India’s telecom sector, which is undergoing rapid digital transformation alongside 5G rollouts. “Vi’s AI Innovation Hub is a testament to the power of co-creation, where IBM consultants can provide best practices and support efforts to build a future-ready digital foundation powered by AI and automation,” she added.

Notably, last week, the telecom major reported a consolidated loss after tax of ₹6,608 crore in Q1FY26, up from ₹6,432 crore a year earlier. However, on a sequential basis, loss narrowed from ₹7,166.1 crore in Q4FY25. Its revenue from operations, however, grew 4.9 per cent year-on-year to ₹11,022.5 crore in Q1FY26 from ₹10,508.3 crore in Q1FY25. Sequentially, revenue increased slightly from ₹10,948.3 crore in Q4FY25.

The company said that its Average Revenue per User (ARPU) for the quarter stood at ₹177, up 15 per cent from ₹154 in Q1FY25. Its 4G/5G subscriber base rose to 127.4 million in the June quarter, up from 126.7 million in Q1FY25.