Phone bills likely to increase as telecoms consider another round of tariff hikes soon

Telecom operators are probably to soon announce another set of tariff hikes as they look to upgrade their Average Revenue Per User (ARPU) by picking out low-paying, inactive subscribers. The initial concern regarding hiking tariffs seem to have gone as despite the hikes undertaken in December 2021, the active subscriber base of the industry has increased in the last few months.

By picking out inactive customers from the network, Reliance Jio, for exemplar, has increased the percentage of its active subscribers, which at February-end touched an all-time high of 94%. While Bharti Airtel focusing on increasing its ARPU further, and Jio leading increasing the profile of subscribers on its network, the result would remain strong even after another round of tariff hike.

Similarly, Vodafone Idea has been spoken about increasing the ARPU for telecom industry, though the company has not shared any specific number. As a result of tariff hikes, the telecom industry has been losing wireless subscribers on a net basis for the last two months, but the active subscriber number has been increasing, means, the paying customers are increasing.

Another analyst said, that though the hikes may not happen in the sudden as the effect of the last round of hikes is yet to fully reflect, but after few months, after the spectrum auctions, telecom operators may look at increasing prices as they need to improve profitability.

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