70 Lakh Users May Leave Vodafone In 12 Months; Airtel Planning Rs 200 Revenue/User
Amid the battle to garner the most subscribers in the telecom space, Vodafone Idea is likely to lose about 500 to 700 lakh users in the upcoming 12-month period.
Seeing this as a golden opportunity, telecom giants Bharti Airtel and Reliance Jio could pounce upon attracting Vi’s customer base to their own.
Additionally, Airtel is gearing up to hiking its current tariffs to about Rs 200 per user over the next 12 months and is working upon its fundraising plans for investing in 5G networks in the country.
Vi to Lose Massive Customer Base
In addition to losing millions of customers in the past some time, telecom giant Vodafone Idea is likely to lose a gigantic amount of users in the upcoming one year’s time, in the count of 500 to 700 lakh.
Many credit rating companies have predicted during a time like this, giants Airtel and Jio will use it as an opportunity to attract subscribers and revenue market share at the expense of Vodafone Idea.
These investments through the rights issuance will help them to further strengthen their network position and to gain more subscribers, states Fitch Ratings.
Airtel to Likely Hike Tariff Per User
Airtel has confirmed its plan to increase the existing tariff for prepaid users, in order to increase the average revenue per user (ARPU) by the end of this financial year.
It stated that it will not just be Airtel but the tariff rise to justify the increasing ARPU will be seen in all telecom companies, in the upcoming months.
To this, Nitin Soni of Fitch Ratings added that the tariff hike in AIrtel cannot be avoided any longer. The management in its call had said they believe that industry tariffs can actually move towards Rs. 200 in the next 12 months, and to Rs 300 over a longer period of time to make a sufficient return on investments.
In the upcoming one year, the ARPU of all telecom companies will improve to the degree of 170 to 180 levels, by increasing prepaid plans and converting 2G users to 4G plan users, which are high-end.
Airtel has announced to increase its ARPU, i.e. tariff plans for prepaid users, after its announcement to raise money for investing in 5G networks.
Airtel currently has immense strength in terms of cash availability, however, Reliance Jio has an immense customer base of 441 million, which makes the latter a leader in terms of market share and user base.