Airtel, Jio & Vodafone Idea May Hike Prepaid Plan Prices By 10%-12% This Year

India¡¯s private telecom service providers, including Bharti Airtel, Reliance Jio and Vodafone Idea are likely to again increase the prices of their prepaid plans by Diwali 2022, as per a report in ET.

They are expected to hike the prices by another 10-12% by Diwali to further boost average revenue per user (ARPU), analysts reportedly said.

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Despite the price increase, the three carriers, including Vodafone Idea, are likely to add up to 40 million customers in FY23, primarily in the underpenetrated rural markets, they said.

The industry, including Vodafone Idea, did not lose active users in the Jan-March 2022 quarter even after 20-25% tariff hikes in November-December last year. Analysts reportedly said that this underlines that the market is ready to take another hike in its stride as telecom tariffs in India remain amongst the lowest globally.

They added that this development marks the return of significant pricing power to the sector and the prospect of the three telcos collectively adding 35-40 million customers by this financial year¡¯s end, i.e. by 31st March 2023.

As per an ET report, a bulk of the new mobile user gains are likely in the rural markets where mobile teledensity is under 58% compared to over 130% in urban areas, as per the latest subscriber data collated by the telecom regulator.

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The Previous Hike

In November 2021, Airtel and Vodafone Idea announced that the telcos would be increasing prepaid tariffs by up to 20-25%, a move that was soon also matched by Reliance Jio, as per an IndianExpress report.

Popular low-tier plans like the Rs 79 plan reportedly went up to Rs 99, while higher-tier plans saw a price increase of up to three digits. Airtel¡¯s 2GB per day plan with 84 days validity went up from Rs 698 to Rs 839 post the hike, the report stated.

Data boosters that cost Rs 48, Rs 98 and Rs 251 for 3GB, 12GB and 50GB respectively, were also priced at Rs 58, Rs 118 and Rs 301 after the hike. Airtel had said in a statement at the time that the higher ARPU would help the telco to ¡°enable substantial investments required in networks and spectrum¡± and also roll out 5G services in the country, as per the report.

The report added that Reliance Jio¡¯s hiked prices, which went into effect a few days later from December 1, 2021, still offered lower prices in popular plans compared to Airtel and Vodafone Idea.

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