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ARPU levels to remain subdued in 2018, says IndRa report

January 10, 2018

According to a report by IndRa, recent slash of tariffs by Reliance JioInfocomm Limited (RJIL) will lead to a further delay in the recovery of the operators’ average revenue per user (APRU) levels.

As per the report, the latest cut in tariffs outlines the uncertainty in pricing which will be highly dependent on consumer behaviour despite consolidation in the industry paving the way for long-term structural improvements. The pricing trend is shifting towards plans with longer validities in order to increase customer stickiness.

The report suggests that although these competitive tariffs do not look sustainable, the short term outlook for ARPU is not hopeful. Two large telecom operators saw their ARPU decline by 25 per cent in the quarter ended September 2017 while RJIL posted an ARPU of Rs 156, Rs 84 higher than the industry ARPU.

According to IndRa, telecom operators will focus more on increasing their subscriber market share than revenue market share in 2018. Further, the agency expects that the dual-SIM phenomenon will be prolonged, given low customer loyalty and high price sensitivity.



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