Telecom service provider Bharti Airtel on Wednesday advocated for differential pricing for different customers while pitching for tariff reform to improve the financial health of telcos.
Gopal Vittal, vice-Chairman and MD of Airtel, while speaking at the investor call for the fourth quarter of FY25, said the current telecom tariff structure in India is broken, with a one-size-fits-all pricing model that is not suitable for upgrades, nor is it in line with any other market. He said restructuring the tariff architecture is essential to improve the financial health of the industry and sustain future investments. “This could simply mean reducing data allowances on some packs and charging more for those who can afford to pay,” said Vittal.
Bharti Airtel, India’s second-largest telecom service provider, has already reported an average revenue per user (ARPU) of `245, the highest among its competitors, with Reliance Jio at `208 and Vodafone Idea at `173 (Q3FY25 ARPU). The company previously said it expects to touch `300 ARPU. While explaining the tariff hike plan, Vittal said entry-level pricing on plans should potentially not go up, and even if it does, it should go up very modestly.
However, the next level of pricing, where there's a large data allowance, should have that data allowance dramatically reduced. And then there should be a reason for people to upgrade to higher plans - for example, small, medium, large, and extra-large. “To illustrate this, if you look at the Indian price architecture and index the entry price at 100 and the highest price, the ratio might be 100 to 250.
But if you compare that with a market like Indonesia, which is similar to us in terms of geographical spread, population density, and so on, the ratio is 100 to 500,” said Vittal. Bharti Airtel reported a 432% year-on-year jump in consolidated net profit to Rs. 11,022 crore for the January–March quarter ended March 31, 2025, driven by tariff hikes and premiumisation.
In the same quarter last year, the company had posted a net profit of `2,072 crore. The telco said that it sees strong tailwinds led by growing penetration of smart TVs and changing content consumption habits. It estimates the industry to grow from the current level of 46 million homes to 80-90 million homes. “we're expanding our market presence with continued rollout of fiber home passes and offering fixed wireless access in newer pin codes where we've not been able to get fiber in,” said Vittal. Its industry-first anti-spam tool has led to significant relief for customers. The company has identified over 27.5 billion spam calls to date, translating to an impressive 1,560 spam calls every second. Since its launch in September '24, customers have seen a 16% reduction in spam calls.
Regarding the DoT's AGR conversion into equity, Vittal said Airtel wanted a non-discriminatory level playing field in terms of having an option to convert.
Whether they'll convert or not is a decision for the board to take. But they wanted to get clarification from the government on whether they had that option or not."