4G Tariff Hikes to Boost ARPU, 5G Tariffs an Insignificant Play

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While the tariff hikes sound bad to consumers, for telcos and their investors, it is a boost to the business. Mobile tariffs in India have been very affordable for consumers compared to what users in other nations have to pay for each GB of data and voice calling services. The last time 4G tariffs were bumped in late 2021, prepaid plans were made around 20-25% more expensive. In December 2019, a scale of 50-60% tariff hike was implemented. Compounded, over the last three years, mobile services are now almost double the cost of what users paid before December 2019. Now another tariff hike is just around the corner. This time as well, it’s the prepaid segment that’s likely to be made expensive. Telcos have largely avoided playing around with the pricing of the postpaid plans.

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It’s hard to assume just how big is the next tariff hike going to be. But what’s for sure is that this won’t be the last of it, and all the telcos will likely be onboard. Tariff hikes would enable the operators to boost their average revenue per user (APRU) figure.

Will 5G Tariffs Make a Difference?

There are no special tariffs for 5G in India right now. Both Airtel and Jio are allowing their customers to experience 5G at no additional cost. This is partly because wide coverage hasn’t been achieved with 5G yet. Once that is done, we may see different tariffs for 5G and 4G.