Vodafone Idea to hike prepaid tariffs by 20-25% from Nov 25

With Airtel raising tariffs, it was expected that both Vi and Jio would follow suit.
Vodafone Idea
Vodafone Idea
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After Bharti Airtel, Vodafone Idea followed suit and increased its prepaid tariffs by up to 25% for various bands. In a statement, Vodafone Idea said that the new plans will start applying from November 25, and will “start the process of ARPU improvement and help address the financial stress faced by the industry”. With Airtel raising tariffs, it was expected that both Vi and Jio would follow suit. 

Its entry-level Rs 79 plan has been hiked to Rs 99 with talktime worth Rs 99, 200MB data, and calls being charged at 1p per second. This plan was previously hiked to Rs 79 from Rs 59. The Rs 149 plan has been hiked to Rs 179 which offers unlimited calling, 300 SMS and 2GB of data. The price of data top-ups has also increased. 

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As per data released by the Telecom Regulatory Authority of India, Vi lost 10.77 lakh subscribers in September, bringing its subscriber base down to 26.99 crore. ARPU, or Average Revenue Per User, has been a matter of concern in the telecom industry, with Vodafone Idea’s ARPU being the lowest among India’s top telecom companies. Airtel’s ARPU as of Q2FY22 was Rs 153, Reliance Jio’s was at Rs 144, and Vodafone Idea was at Rs 109. 

Vodafone Idea CEO Ravinder Takkar, during a recent post-earnings investor call of the company, had asserted that tariff hike remains critical for continued revival of the sector. Takkar said the company has started working on raising mobile tariffs, and it is expected to be in place very soon.

"Some activity on tariff hikes has started to happen. Tariff hikes which are the next important step will also take (place) soon. For us, particularly as a company, we will not shy away from raising tariffs," Takkar had said.

Bharti Airtel Chairman Sunil Mittal had earlier this year said the industry's tariffs need to go up amid tremendous stress in the telecom sector. The company has been of the view that mobile industry ARPUs (Average Revenue Per User) is not sustainable and should improve to Rs 200 in the near term, and Rs 300 in the longer term.

The telecom sector is buoyant and upbeat after the government recently approved a blockbuster revival package that includes a four-year break for companies from paying statutory dues, permission to share scarce airwaves, change in the definition of revenue on which levies are paid and 100% foreign investment through the automatic route.

The measures -- aimed at providing relief to telecom service providers that have to pay thousands of crores in unprovisioned past statutory dues -- also include the scrapping of Spectrum Usage Charge (SUC) for airwaves acquired in future spectrum auctions.

With inputs from PTI

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