Bharti Airtel, the second-largest telecom operator in the country, is popular for providing postpaid services. The telco is especially popular in the corporate world for offering uniform postpaid mobile services across India. With the prepaid tariff hikes already implemented, there’s no way that the telcos aren’t already planning on increasing the postpaid tariffs as well. It is only a matter of when it will happen.
But largely, Bharti Airtel’s postpaid customers won’t be budged by the tariff hikes that might arrive in the near future. In fact, it might be the same case with Vodafone Idea customers.
Airtel Has 50% to 60% of Postpaid Customers in Corporates
As mentioned above, Bharti Airtel is very famous in the corporate world for providing postpaid mobile services. According to an FE report, 50% to 60% of Airtel’s total postpaid customers work in corporates. With such a large percentage of users being enterprise customers, Airtel is in a good position to increase tariffs.
Enterprises don’t care a lot about the money they are paying for mobile postpaid services as long as they can get a strong service against it. Enterprises are always after quality and seamless experience because it affects their work. So even if Airtel goes with a 10% to 20% tariff hike with its postpaid plans, there will not be many issues as long as it can provide quality services against it.
Postpaid Customers Don’t Really Care Much About Expense
Postpaid customers, in general, are more accepting of higher tariffs. They already pay twice or thrice of what a prepaid customer pays. This is because postpaid plans allow them to get premium service from the telcos.
Bharti Airtel already has the highest average revenue per user (ARPU) amongst all the private telcos in India. The telco will require a substantial revenue boost to reach Rs 200 ARPU levels. This means that postpaid plans need to get more expensive.
Postpaid customers, much like corporate or enterprise customers, care more about the kind of service they are getting instead of the money they are paying.
Airtel and Vodafone Idea would be in a good position to go with postpaid tariff hikes as both the telcos have enterprise customers as well.
Ultimately, the telcos are eyeing to reach Rs 300 ARPU levels. This will not be possible with just one tariff hike. In the coming years, multiple tariff hikes will make their way to the market, and both prepaid, as well as postpaid plans, will become much more expensive than they cost today.
2G/3G users would also fade away in the coming years, which will further mean an ARPU boost for the telcos. While the telcos have not hinted anything regarding the postpaid tariff hikes, it is highly unlikely that they are not working on it already. The more the telcos will wait, the more their business will hurt, which doesn’t make sense.
The telecom operators will be looking to reach the 2016 ARPU levels, which was over Rs 200, in the near future.