Airtel Wants To Hike Tariff For More Profits; Targets 85% More Revenue Per User
We have received strong indications that India’s 2nd biggest telecom provider: Airtel can very soon increase tariffs for both data and voice service, across India.
Bharti Airtel CEO gave this hint, and has said that the prices of data and voice calling services will ‘need’ to be increased. Apparently, the current tariff rates are not sustainable for the industry, and for Airtel.
Does this mean that Airtel will be hiking its tariff rates? Read on to find out!
Bharti Airtel Chief Executive Predicts Hike In Data And Voice Calling Charges
Bharti Airtel Ltd. Chief Executive Gopal Vittal was speaking to analysts at a post-earnings conference call where he said that internet prices and voice calling services will be offered at a higher price because the current rates of internet and voice calling are not very feasible for the industry.
However, he did not specify any time or schedule of the hike in tariff but he said that he is confident about a hike in tariff rates in the near future.
As per Vittal, Airtel wants to reach an average revenue per user (Arpu) of ?200 and also ?300 gradually.
Interestingly, Airtel has just posted a record jump in revenues, and have decreased their losses by more than 90%.
But it seems that they want more.
Airtel Wants 85% More ARPU
When Vittal was asked about why Airtel isn’t taking the lead in increasing prices, he said, “We are at a premium (in terms of tariff hike). In the telecom space, you can have a premium but it becomes unsustainable after a point. We do not want to slow down our growth.”
Prior to this, the Chairman of Airtel, Sunil Mittal had dropped hints about an increase in the charges of mobile plans in the next six months.
Airtel has increased their ARPU to Rs 162, but they want Rs 200-Rs 300 ARPU, very soon.
Earlier, Sunil Mittal has said that customers should pay Rs. 100 for each GB of data. Instead of getting 16 GB data for Rs. 160, people should only get 1.6 GB. As per Mittal, paying only Rs. 160 for 16 GB data is a ‘tragedy’.
As of now, Airtel offers 1 GB data per day for Rs. 199, with 24 days of validity. This means that Airtel charges a bit more than Rs. 8 per GB.
Mittal states, “You either consume 1.6 GB of capacity per month either at this price point or you may prepare to pay a lot more. We are not wanting USD 50-60 like the US or Europe but certainly USD 2 for 16 GB a month is not sustainable.”
As per reports, Vittal has said that Airtel will keep up with offering quality 4G data to customers.
4G data customers of India’s second-largest telecom operator increased from to 152.7 million for the Q2 of FY2020-2021.