Faced with increasing debt and falling ARPUs, telecom operators plan to hike their call tariffs by 20-30 per cent this year, say news reports.
At Re 0.01 per second, base tariffs for voice calls in India are the lowest in the world. However, for operators, the low-cost tariff model has become unsustainable as margins have been hit hard. The contribution of voice revenues to overall operator revenues has been continuously declining. Therefore, a tariff increase is inevitable.
This is the second time the industry will witness tariff hikes. Prior to this, in July 2011, Bharti Airtel increased tariffs by 20 per cent for prepaid subscribers in the Delhi, Andhra Pradesh, Kerala, Madhya Pradesh and Gujarat circles and later extended this to 13 more circles.
It hiked tariffs for two plans ? Advantage and Freedom ? for calls and SMSs within the airtel network. Users of the Advantage plan now pay Re 0.60 per minute instead of Re 0.50 per minute for local and STD calls and Re 0.90 per minute for calls to landlines. In addition, subscribers are charged Re 1 and Rs 1.50 per local and national SMS respectively. Existing users are required to pay the new rates after the validity of their existing vouchers expires. Subscribers of the Freedom plan are now charged Re 0.12 per second for local and STD calls as compared to Re 0.01 per second earlier.
Following this, Idea Cellular and Vodafone India also increased tariffs for their prepaid plans in select circles while Bharti airtel applied its new tariffs to other circles. Idea increased its tariff from Re 0.01 per second to Re 0.012 per second for all calls to other networks in the Delhi service area under the per second billing scheme, before revising call and SMS rates for circles like Gujarat, Madhya Pradesh and Maharashtra.
Vodafone India, on the other hand, increased tariffs in 12 circles from Re 0.01 per second to Re 0.12-Re 0.15 per second.
