Bharti Airtel ARPU Rise Sets Good Precedent for the Industry

Two major telecom companies of India, Reliance Jio and Bharti Airtel have come out with their quarterly figures now. Being the first quarter of the new financial year 2022, these numbers are crucial and set the tone for the rest of the year.

Highlights

  • Reliance Jio on the other hand exceeded quarterly expectations of analysts
  • However, ARPU of Bharti Airtel was higher than Reliance Jio's
  • Bharti Airtel's quarterly performance overall did not meet analysts' expectations

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Bharti Airtel
Bharti Airtel followed with its quarterly earnings report filing a few days back. Not only this, but the Bharti Airtel CEO, Gopal Vittal, also shared his thoughts on the performance of the company and said things about the future plans of Bharti Airtel. Two major telecom companies of India, Reliance Jio and Bharti Airtel, have come out with their quarterly figures now. Being the first quarter of the new financial year 2022, these numbers are crucial and set the tone for the rest of the year. Also, they urge us to compare the Average Revenue Per User (ARPU) of both the companies and what has worked for them and what has not.

Reliance Jio and Airtel Comparison

While Reliance Jio has averaged an ARPU of Rs 138 and has managed to only register a rise of Rs 0.2, Bharti Airtel has grown by leaps and bounds and has managed to surpass the figure of Rs 140, only to have its ARPU at Rs 146. Now, we have already talked at length about how Reliance Jio and Bharti Airtel differ in their strategies. Bharti Airtel has always had eyes on a higher ARPU, and it thinks that it can prioritise adding subscribers at a slow pace while maintaining the overall paying quality of its subscribers. As such, it has high-paying subscribers and an active subscriber base which is more than that of Reliance Jio.

Moves That Led to Airtel’s High ARPU

This is the peculiar thing about the two telecom companies, Reliance Jio boasts of having more than 400 million subscribers, but still, it has fewer active subscribers than Bharti Airtel. Most of the subscribers of Reliance Jio have come from the JioPhone category indicating that they have a higher tendency of paying less with the more affordable plans and might also go bust from the network. On the other hand, Bharti Airtel has made a stride on the opposite end of the spectrum by removing its low-paying prepaid plan of Rs 49 and starting its portfolio from Rs 79. Not only this, the corporate plans of Bharti Airtel now start at Rs 299, which is a solid Rs 100 above the previous figure.

Bharti Airtel’s Bold Moves Pay Off

After making these changes, Bharti Airtel has certainly noticed a small churn in subscriber count, but even then, it retains the top active subscriber position. Most noteworthy of all, the telecom company has a lead in ARPU, which remains the most sought-after figure in the industry and the teller of the financial health of the telecom companies. The steps taken by Bharti Airtel surely indicate a step in the progressive direction. Since a unilateral tariff hike is feared in the industry, in such an environment, Bharti Airtel’s move comes as a bold step, and its success sets a good precedent for others to follow, that a slight increase in tariff or the removal of low paying plans will lead to increase in the ARPU and hence in the overall finances of the company. These are the kind of steps that ailing telcos like Vodafone Idea can resort to in the end.

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Junior Editor

Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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