Everyone knows that 5G tariffs are not going to be too different from the 4G tariffs right now. While 5G has great speed, the telcos won't be able to justify pricing 5G plans at a higher range when there's not even good coverage. That is why, to increase the ARPU (average revenue per user), the telcos would want to hike the price of 4G plans. Indian telcos have often expressed that the ARPU of the sector is very low compared to the investments they have been making.
There's not much demand for 5G services. Thus, if the tariffs are high, the uptake of 5G from consumers would be very low. Most users would still recharge with 4G plans. Thus, the telcos would push for the 4G tariff hikes, possibly by the end of this year.
Airtel and Vi have Expressed that they Want to Raise Tariffs
Both operators have expressed their intent to raise 4G tariffs by the end of 2022. The end of the year is mostly when telcos go for hikes; at least, that's what happened the last two times in 2019 and 2021.
Airtel was the operator which led the tariff hikes in 2021. This time as well, the telco should be able to do so. Vi would just be waiting for one of the operators to move ahead with the hikes so that it can also follow. Airtel wants to surpass the ARPU figure of Rs 200 in the short term. With the next round of tariff hikes, that should be very much done. Currently, Airtel and Jio both have ARPU of close to Rs 190 and Rs 180. Vi is the one which is far behind and has not even touched the Rs 150 level.
It would be an interesting tariff hike this time as consumers would also be looking at the operators to reveal more about the future of 5G and the tariffs surrounding it.
