After Jio, Airtel and Vi answer revenue call, dial up tariffs
Bharti Airtel and Vodafone Idea (Vi) increased mobile tariffs by 11-20% and 10-23%, respectively, to boost average revenue per user (ARPU), a day after Reliance Jio announced higher rates, making this the first wide-ranging headline price increase since November 2021.
While Airtel and Jio — which dominate the market — say they need to improve returns after paying high prices for 5G airwaves in 2022, Vi is looking to back up its recent ₹23,000 crore equity fundraising efforts as it strives to become more competitive, stem user losses and repair a stressed balance sheet to pay vendors and statutory dues. Analysts said the three telcos will see a 13-17% rise in ARPU with the main effect being felt in second and third quarters of this fiscal year.
Airtel and Vi have been vocal about increasing ARPU at an industry level for a sustainable telecom sector.
Monetisation of 5G services
They have been backing a higher-price-for-more-usage model, as is the global practice, instead of the local trend where a customer pays the same on average, regardless of the level of data usage. «Bharti Airtel has maintained that the mobile average revenue per user (ARPU) needs to be upwards of Rs 300, to enable a financially healthy business model for telcos in India,» the company said in a statement Friday announcing the increases. «We believe that this level of ARPU will enable the substantial investments required in network technology and spectrum and offer a modest return on capital.»
In a statement, Vi said its plans are
