Bharti Airtel Prepaid Tariff Increases by 20%
The country’s largest telecommunications company Bharti Airtel on Friday became the first telecom operator to raise prices since 2011. The company increased pre-paid tariffs of the Advantage Package. Industry leaders said Bharti price increase will expand to other parts of the country soon and added that its primary competitors in the GSM space – Vodafone Essar and Idea Cellular – are expected to follow.
As users of Advantage package, which is based on per minute billing will now pay 60 pais per minute for local and STD calls to mobile and 90 pais for local and STD calls to landlines.Bharti Airtel has announced 20% increase in pre-paid tariffs by their “Advantage” and “Freedom” package for calls and SMS messages sent within the Airtel network.
Furthermore, R. 1 and R. 1.5 will be charged for local and national SMS, respectively. Existing users will have to pay for new courses, after the validity of their existing coupon ends. Recently, the Mumbai region, increased most operators, including Bharti Airtel, Vodafone Essar and Idea Cellular, long distance or STD call rates.
Shubhranshu Singh, National Head, Customer Marketing and Key Accounts for Diageo India is on its way to Visa as Marketing Director, India and South Asia, effective August 1. The six regions where Bharti has increased local and long distance calling rates include Delhi, Andhra Pradesh, Kerala, Rajasthan, Madhya Pradesh and Gujarat.
However, there is no increase in price for their freedom package, based on per second billing. While it remains uncertain whether the move made by the country’s largest telecommunications company in both subscriber share market and revenue share in the market will be emulated by other players, but it emphasizes the end of tariff wars for some and can easily be interpreted as a precursor of an impending market consolidation. The brutal price war that has plagued the sector over the past two years have resulted in the Indian consumers enjoy rock bottom prices – the lowest in the world. Tariff cuts also destroyed the profitability of most mobile operators in 14-player market.
“All telecom operators have been under pressure, and growth has been flat in recent quarters. All the incumbents have had thinning of the margins,” Jaideep Ghosh of KPMG said. Tata Teleservices, which had triggered the price war with its per-second billing based GSM offers about two years ago, has recently doubled its STD calls to new subscribers after one year of support and raised local and national SMS charges by 67% and 25% respectively.
