Airtel recently discontinued its lowest recharge plan in Andhra Pradesh, Bihar, HP, Rajasthan, Northeast, Karnataka, and UP-West. With this, the rate of the base plan offered by the telecom operators has now increased by 57 per cent. Now, instead of Rs 99 users will have to pay Rs 155, which is now the entry-level plan for prepaid users.
Airtel is said to be revising the tariffs in order to increase the revenue and margins of the company. Last year, Airtel started scrapping its Rs 99 plan and removed it from the list in Haryana and Odisha. Now, the plan is not available in more circles leading to the hike in the entry-level plan to Rs 155.
Airtel Rs 99 plan offered limited talk-time with a validity of 28 days. However, the upgraded base plan of Rs 155 will offer unlimited calling, 300 SMS, 1GB data for 24 days. The Rs 99 was a little affordable and offered more validity, the new base plan will definitely strain the user's pocket a bit. Especially for those users who use Airtel as a secondary SIM.
It is also expected that Airtel will scrape the Rs 99 from more circles in the future. Telecom giants like Jio and Airtel will change and increase the prices of their existing plans by 10 per cent. A report by Business Insider)suggests that telecom operators including Jio and Airtel might announce 10 per cent hike in tariffs consequently in the next 3 years i.e. Q4 of FY23, FY24 & FY25. This could further hike the prices of mobile plans every fourth quarter of the coming years.
The hike in tariffs is suggested to be due to the increasing pressure on companies' revenue and margins. The average revenue per user (ARPU), a crucial indicator of a telecom company's performance, increased moderately for Airtel, Vodafone Idea, and Jio in the third quarter. Now, with the hike in prices, the ARPU is said to see a significant rise.
Additionally, the revenue is also based on the subscriber base. In the last few months, both Airtel and Jio witnessed a significant increase in their subscriber base. This increased the ongoing competition between the two telecom companies to attract more users. Jio and Airtel are also currently in a neck-to-neck competition for 5G as they are the only two telcos that are offering 5G services in India.
On the other hand, Vodafone Idea (Vi) is witnessing a loss in revenue and subscriber base. For the same reason, despite being the third largest telecom operator in India, Vodafone-Idea is struggling with finances which are delaying the company's plan to launch its 5G in India.
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