Bharti, Vodafone hike mobile tariffs

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New Delhi, Aug. 13

Faced with declining average revenue per user (ARPU), mobile operators are now increasing their tariffs.

Bharti Airtel and Vodafone Essar have increased local charges for calls within their own network by 20 per cent. All pre-paid and post-paid subscribers using the low-end tariff pack with rentals less than Rs 150 per month will have to pay Rs 1.20 per minute instead of Re one a minute for Airtel-to-Airtel calls and Hutch-to-Hutch calls.

New SMS rates

The two operators have also increased local SMS rates to Rs 1.20 per message for all users - both pre-paid and post-paid - from Re one earlier. This comes within a few weeks of an increase in STD rates in Delhi. Both Bharti Airtel and Hutch had increased their STD rates to Rs 2.60 per minute from Rs 2.40 per minute and Rs 2 per minute, respectively.

The increase in tariff comes even as the operator's revenue per user continues to dip over the past year. The national average is hovering around Rs 300 per user per month, which is among the lowest in the world.

Though operators such as Bharti Airtel have stopped using ARPU as a measure for checking the financial health of the company, the increase in tariff targeted especially at low-end users clearly indicates the operator's concern about declining ARPUs. Other operators are also likely to follow suit given that the two largest cellular operators have taken the lead.

Consumer groups, however, pointed out that the operators have not given any publicity to the increase in tariffs to create awareness among users. They said that the telecom regulator should take a look at the revised rates. The operators, on the other hand, said that advertisements were issued to inform the subscribers. The increase comes even as the Communications Ministry has made lower tariffs as one of its primary goal this year.

Taken from Business Line

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