NEW DELHI: The early signs of the tariff hike by telecom service providers are encouraging, and it has not had a significant impact on telecom subscribers, said Gopal Vittal, managing director of Bharti Airtel, on Tuesday.
Vittal, speaking during the company’s first quarterly earnings call, noted that there was no major SIM consolidation following the tariff hike in July 2024, except for a slight impact at the lower end of the market, particularly among 2G users.
“The industry undertook a round of tariff hike in early July 2024, which was much needed for the financial health of the industry. The early signs from this repair are encouraging… I do want to underscore that the industry needs a minimum Rs 300 ARPU (average revenue per user) for long term, sustainable investment, and respectable return ratios,” said Vittal.
In July 2024, all three major private telcos —Reliance Jio, Bharti Airtel, and Vodafone Idea — announced tariff hikes ranging 10% to 25%. The last such raise occurred in November 2021. This time, Jio led with the tariff increase of 12-25%, followed by Airtel with hikes ranging from 11% to 21% across its prepaid and postpaid plans.
Vodafone Idea raised tariffs by 10-23%. “We’ve noticed some SIM consolidation happening at the lower end of the market, particularly among 2G user base. However, the SIM consolidation we’ve seen so far has been modest. Only time will tell how things play out,” Vittal said.
As per Vittal, 5G monetisation remains a challenge and there are no major global use cases beyond fixed wireless access (FWA). Airtel plans to launch a standalone 5G network to support its FWA broadband service in August-September. It will use the standalone network for this purpose.