Airtel Chairman Sunil Mittal hinted at an increase in mobile service prices in the next six months. This follows after he said that data at low rates are not sustainable for the telecom industry.
The chairman has recommended that instead of getting 16GB data for Rs. 160, users should only get 1.6GB at this price point. "16 GB data consumption a month for Rs 160 is a tragedy," Mittal said.
"You either consume 1.6 GB of capacity per month either at this price point or you may prepare to pay a lot more. We are not wanting USD 50-60 like the US or Europe but certainly USD 2 for 16 GB a month is not sustainable," Mittal said at an event, according to a report by PTI.
Speaking on the average revenue per user (ARPU), a metric that is commonly used to assess the revenue generated by a telco (telecom) company, Mittal said that Airtel is expecting to cross Rs 200 in six months on digital content consumption.
Airtel reported an increase in the ARPU to Rs 157 in the first quarter ended June 30, 2020. This rise in ARPU came after the tariff hike by Bharti Airtel during December 2019.
"We need a Rs 300 ARPU in which you will still have lower end at Rs 100 a month with decent amount of data. But if your consumption is largely around watching TV, movies, entertainment and depriving other vital special services networks, then you need to pay for that," Mittal said at the launch of a book written by Bharti Enterprises executive Akhil Gupta, the report said.
"We are down to 2-3 players now. India is a very price-conscious market. In six months time, we should be crossing the mark of Rs 200 for sure and Rs 250 would be ideal," Mittal said, adding that businesses which are not in telecom should also look towards digital and should see solid ARPUs building up in the next 5-6 months for the industry to be sustainable.
