India's first private telecom operator, Airtel has increased the tariffs on its cheapest plan for prepaid users by 40 per cent. The Rs. 35 plan will now cost Rs 49. This hike in tariffs will affect 95 per cent of its customer base of around 300 million. Earlier this year, the company also increased the minimum validity recharge from Rs 23 to Rs.45,which is almost double. These hike in tariffs comes at a time when Airtel is faced with the dual challenges of humongous losses and outstanding payments.
What all will you get for Rs 49?
The Rs 49 plan has a validity of 28 days. It offers a talk time of Rs 38.52 and provides 100 MB of data.This plan is slotted in the smart recharge category.
Competitors Jio and Vodafone also hiked the tariffs of all their plans of late.The cost of these plans has been increased to factor in higher costs. The telecom sector is plagued with massive outstanding payments and debt defaults. The challenges faced by the telecom sector have only intensified owing to the 24 October ruling of the Supreme Court that ordered the telecom sector to pay a massive amount of Rs 1.47 lakh crores in past dues to the government in a period of 3 months.
Sunil Bharti Mittal, the chairman of the Airtel group said recently that the average revenue per user (ARPU) made by the telecom companies per subscriber per month needs to go up to Rs 300 to reach healthy and sustainable levels. The current ARPU of Airtel is Rs 128. Mittal also went to say that the way to get to Rs 300 ARPU is to first get to Rs 200 where a user will pay Rs 100 at the lower end and Rs 450-500 if his data usage is very high.
This continuous hike in tariffs is in keeping with the December 1 announcement by the company wherein it announced a tariff hike after a gap of three years. The other reason is to survive in the market since Reliance Jio has been providing affordable plans to its users. These plans provide users with unlimited data and also extremely cheap tariff rates.CAA protests: Telcos losing Rs 2.4 crore every hour they are forced to suspend internet services