Explained: Why India's Leading Telecom Companies Are Raising Tariffs; Check The Latest Rates

Explained: Why India's Leading Telecom Companies Are Raising Tariffs; Check The Latest Rates

This move is effective from today, June 3 for Jio and Airtel, while for Vi, it will be from July 4.

G R MukeshUpdated: Wednesday, July 03, 2024, 01:51 PM IST
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Explained: Why India's Leading Telecom Companies Are Raising Tariffs; Check Latest Rates |

The India's leading telecom giants - Reliance Jio, Bharti Airtel, and Vodafone Idea (Vi), last week announced a significant tariff hikes across their prepaid and postpaid plans.

This move is effective from today, June 3 for Jio and Airtel, while for Vi, it will be from July 4.

Details of the Tariff Hikes

The price hikes are substantial, with increases ranging from 10 per cent to 30 per cent. Mukesh Ambani led Reliance Jio was the first to announce the hikes, followed by Airtel and Vi.

Reliance Jio - Tariffs will increase by 12 to 25 per cent.

For example, the Rs 239 monthly plan with 1.5GB of daily data will now cost Rs 299, a 25 per cent hike.

Airtel - Prices will rise by 11 to 21 per cent.

Vi - Tariffs will go up by 10 to 21 per cent.

Check Latest Rates (Postpaid) - Jio, Airtel, and Vi

Prepaid Plans for 28 days -Jio, Airtel and Vi

Prepaid Plans for 28 days -Jio, Airtel and Vi |

Prepaid Plans for 56 days -Jio, Airtel and Vi

Prepaid Plans for 56 days -Jio, Airtel and Vi |

Prepaid Plans for 84 days -Jio, Airtel and Vi

Prepaid Plans for 84 days -Jio, Airtel and Vi |

Prepaid Plans for 365 days -Jio, Airtel and Vi

Prepaid Plans for 365 days -Jio, Airtel and Vi |

What are the reasons behind this hikes?

The telecom companies argue that the tariff hikes are necessary to maintain profit margins and continue investing in new technologies like 5G.

Airtel emphasised that higher tariffs would improve quality and coverage, while Jio aims to boost average revenue per user (ARPU) and start monetising its 5G services.

Impact on ARPU and Financial Health

Airtel has stated that the mobile ARPU needs to be upwards of Rs 300 to sustain a financially healthy business model.

As of the March 2023 quarter, Airtel's ARPU was Rs 209, Jio's was Rs 181.70, and Vodafone Idea's was Rs 146.

The tariff hikes are expected to boost the blended ARPU by 15 per cent to Rs 220 in the fiscal year 2025, compared to Rs 191 in the previous fiscal year. This could expand the telcos' profit before interest, lease depreciation, and tax (PBILDT) by 20 to 22 per cent in the current fiscal year, reported ETTelecom.

Consumer Reactions

While many consumers are unhappy with the price increases, however telecom companies believe these changes are important for better service in the long run.

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