Jio and Bharti Airtel Announce Tariff Hikes Jio hiked service plans by 12-25 per cent, whereas, Airtel has increased mobile tariffs by 10-21 per cent
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Reliance Jio and Bharti Airtel have announced significant tariff hikes, as a result, mobile bills are set to rise. Jio revealed a 12-25 per cent increase across service plans on Thursday, followed by Airtel's announcement of price hikes on Friday. This move is aimed at boosting telecom operators average revenue per user (ARPU) due to the high investments in 5G services.
According to the Telecom Regulatory Authority of India (TRAI), India had 1.14 billion wireless subscribers at the end of fiscal 2023. In 2023, Jio accounted for 39 per cent of this wireless subscriber base, with an average wireless subscriber count of 447 million. Airtel followed with 30 per cent of India's wireless subscriber base, at an average wireless subscriber count of 339 million, while Vodafone had an average wireless subscriber base of 223 million.
Bharti Airtel announced a 10-21 per cent hike in mobile tariffs, a day after Reliance Jio announced an increase in rates. Airtel, in a release, said that the revision in mobile tariffs will be effective from July 3. "We have ensured that there is a very modest price increase (less than 70 paise per day) on entry-level plans, to eliminate any burden on budget challenged consumers," the Sunil Mittal-led telecom firm said. Bharti Airtel said it has maintained that the mobile ARPU needs to be upwards of INR 300, to enable a financially healthy business model for telcos in India.
Indian telecom users may face a significant increase in their mobile bills in the coming months, said a report by Antique Stock Broking, earlier. The report predicted an imminent tariff hike of 15-17 per cent across the telecom sector, with the implementation potentially happening after the general elections held during April-May 2024. Telecom operators in India have been grappling with several financial challenges in recent years. The report suggests that the anticipated tariff hike is a way for telecom operators to improve their financial health and invest in network upgrades.
This move by telecoms will be boosted further by the increase in 5G subscription. Recently, Ericsson released its Mobility Report, revealing several key insights into India's 5G network. According to the report, India's 5G subscriptions reached approximately 119 million by the end of 2023, reaching a 10 per cent penetration rate. The report projects that 5G subscriptions in India will reach around 840 million by the end of 2029, representing 65 per cent of all mobile subscriptions in the region.
The price hike announcement comes close to the heels of the completion of the second 5G auction. It is to be noted that the Central government's second 5G spectrum auction saw subdued bidding by telecom companies, which collectively bid INR 11,340 crore for a total 141.4 MHz of airwaves. Bharti Airtel emerged the top bidder by acquiring airwaves worth INR 6,856.76 crore, followed by Vodafone Idea at INR 3,510 crore. India's largest telecom operator Reliance Jio had deposited the highest earnest money of INR 3,000 crore but it bid only INR 973.62 crore to pick up additional spectrum. In the previous 5G spectrum auction held in August 2022, the government fetched INR 1.5 lakh crore.
