Vodafone and Airtel on Monday announced their decision to increase tariffs from next month. They both made their decision amidst reports of government moving to set a floor price for voice and data. On the other hand, Reliance Jio, which is keeping on eye on the developments, has not made any announcements yet.
Reliance Jio, after providing free voice calls for three years, started charging 6 paise per minute from October for making calls to any non-Jio number after TRAI floated a consultation paper on deferral of the zero IUC regime citing non-symmetry traffic.
The sources added that Jio also is waiting for the Vodafone and Airtel's tariffs numbers announcement and will react after that.
Vodafone and Airtel's plan to increase tariffs came after the Supreme Court asked them to follow Department of Telecommunications' AGR computation method on revenue sharing with the government, making both liable to pay around Rs 74,000 crore by January 24, 2020.
Although a panel of Secretaries to the Central government are looking at options of giving them some relief through a longer repayment period and a cut in levies
Vodafone Idea mentioned "acute financial crisis" as the reason behind the tariff rise, whereas Airtel said that the move is meant to keep the company and the industry "viable"
Vodafone Idea said, "To ensure that its customers continue to enjoy world-class digital experiences, Vodafone Idea will suitably increase the prices of its tariffs effective December 1, 2019".
"The acute financial stress in the telecom sector has been acknowledged by all stakeholders and a high-level Committee of Secretaries (CoS) headed by the Cabinet Secretary is looking into providing appropriate relief," said Bharti Airtel.
The Sunil Mittal-led telco said, "The telecom sector is highly capital intensive with fast-changing technology cycles that require continuing investments. It is, therefore, extremely important that the industry remains viable to support the vision of Digital India. Accordingly, Airtel will appropriately increase price offerings in the month beginning December."
Additionally, Reliance Jio's parent company Reliance Industries Limited (RIL) became the first Indian firm to cross the Rs 9.5 lakh crore market capitalisation mark today. The rise in RIL share price came after Vodafone India and Bharti Airtel's announcement to increase tariff from December. The tariff hike is likely to attract more subscribers for Reliance Jio.
(Edited by Vivek Dubey)