Mobile calls and internet charges will go up by up to 50 per cent in the country, as private sector players - Bharti Airtel, Vodafone Idea and Reliance Jio - on Sunday announced their plans to raise tariffs from December 3 onwards. This is the first hike in last five years in the country’s telecom space that was facing bruising tariff war, with voice calls becoming almost free and data prices fell by 95 per cent to Rs 11.78 per GB from Rs 269 per GB in 2014.
While Bharti Airtel and Vodafone Idea have shared new rates in the “unlimited” category that will replace their existing pre-paid plans with up to 50 per cent higher cost, Reliance Jio said it will roll out new all-in-one plans with unlimited voice and data at up to 40 per cent higher price from December 6.
Vodafone Idea was first to announce “new tariffs/plans for its prepaid products and services. New plans will be available across India starting 00:00 hours of 3 December 2019”.
Bharti Airtel followed Vodafone Idea by announcing similar plans to raise mobile pre-paid services rates.
Vodafone Idea announced maximum increase of 50 per cent in its entry level unlimited plan with a year-long validity of Rs 1,499 with 24 GB data usage limit in place of Rs 999 plan, which comes with 12 GB data usage limit.
Bharti Airtel too announced a similar level of change but kept price of most of the new plans lower by Re 1 compared to that of Vodafone Idea.
From December 3, customers of these two companies will have to shell out a minimum of Rs 49 to make calls, access the internet on mobile and stay connected for four weeks.
Reliance Jio also announced with plans to raise mobile services rates from December 6 onwards.
“The new plans will be effective from December 6, 2019. Although, the new All-In-One plans will be priced up to 40 per cent higher, staying true to its promise of being customer-first, Jio customers will get up to 300 per cent more benefits,” Jio said.
While telecom operators have been offering unlimited voice calling, both Vodafone Idea and Bharti Airtel have now decided to cap the outgoing calls outside their network from December 3.
Both the companies have capped outgoing calls to network of other telecom operator to 1,000 minutes in case of plans with 28 days validity, 3,000 in 84 days validity plans and 12,000 in 365 days validity plans. Beyond this limit, customer will need to pay 6 paisa per minute for outgoing calls.
Jio has said that that company’s new “plans will have a fair usage policy for calls to other mobile networks”.
The last increase in mobile tariffs was noticed in 2014.
According to Telecom Regulatory Authority of India (Trai), prices of mobile data have fallen drastically by about 95 per cent to Rs 11.78 per gigabyte (GB).
The average cost to subscriber for wireless data in the year 2014 was Rs 269 per GB and Rs 226 per GB in 2015. But, after introduction of 4G technology in India, average cost to subscriber for wireless data usage sharply declined to Rs 75.57 per GB during the year 2016.
Further, average cost to subscriber for wireless data declined from Rs 19.35 per GB in the year 2017 to Rs 11.78 per GB in the year 2018.
Telecom companies’ move to raise mobile tariff follows the Supreme Court judgement, on October 24 this year, upholding the government’s method of calculating revenue share that it should get from earnings of service providers.
Vodafone Idea last month reported a consolidated loss of Rs 50,921 crore—the highest ever loss posted by any Indian corporate—for the September quarter on account of liability arising out of the Supreme Court’s order.
The company has estimated liability of Rs 44,150 crore post the apex court order, and made provisioning of Rs 25,680 crore in the second quarter this fiscal.
Vodafone Idea which is reeling under massive debt of around Rs 1.17 lakh crore had earlier cited acute financial stress on the company behind the decision to raise mobile call and data charges.
Bharti Airtel has posted a staggering Rs 23,045 crore net loss for the second quarter ended September 30, due to provisioning of Rs 28,450 crore in the aftermath of the SC ruling on statutory dues.
According to government data, the liabilities in the case of Bharti Airtel add up to nearly Rs 35,586 crore, of which Rs 21,682 crore is licence fee and another Rs 13,904.01 crore is the SUC dues (excluding the dues of Telenor and Tata Teleservices).
The government is currently not considering any proposal on waiver of penalties and interest on outstanding licence fee based on adjusted gross revenue (AGR), or on extending the timelines for telecom companies to pay up their statutory dues.