India’s Tata DoCoMo has secured a license to retain the use of the DoCoMo brandname after the Japanese company sells its stake in the mobile network.
The Tata’s have secured an agreement to retain the brandname for at least a year, the Economic Times reported. The agreement relieves the struggling mobile network from the unwanted extra costs of a major rebranding exercise, in the short term.
The Japanese company has agreed to let Tata use the brand name in lieu of what is called a “marginal royalty”, which will push up what the Tatas may need to pay if they have to buy back NTT DoCoMo’s 26.5% stake in the joint venture, a senior official in Tata Teleservices told the newspaper.
NTT DoCoMo announced last month that it is looking to sell its stake in the Indian mobile network after it reportedly failed to meet performance requirements.
There are strong rumours that Vodafone could be looking to buy the company, but it’s strained relations with the government could make securing regulatory approval difficult at the moment.