Postpaid ARPU Declining for Indian Telcos, What No One is Talking About

Indian telecom operators need to push their postpaid ARPU up as well. For quarters now, the ARPU has been declining. Telcos don't really interfere with their postpaid plans a lot. Whether 5G would make a difference with postpaid or not is something we will have to wait and watch, as the tariffs haven't been announced yet. 

Highlights

  • Postpaid subscribers in India are rising every quarter that goes by, but no one is talking about the falling average revenue per user (ARPU) from postpaid services for the telcos.
  • While the Indian telcos are too vocal about the tariff hikes required for prepaid segment customers, they are facing a declining trend of ARPU from postpaid subscribers every quarter.
  • The three major players in the postpaid business in India are Reliance Jio, Bharti Airtel and Vodafone Idea (Vi).

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Indian Telecom Operators

Postpaid subscribers in India are rising every quarter that goes by, but no one is talking about the falling average revenue per user (ARPU) from postpaid services for the telcos. While the Indian telcos are too vocal about the tariff hikes required for prepaid segment customers, they are facing a declining trend of ARPU from postpaid subscribers every quarter. The three major players in the postpaid business in India are Reliance Jio, Bharti Airtel and Vodafone Idea (Vi). The largest player is Vi in the postpaid segment, but this is something we will talk about later. Right now, let's focus on the declining trend of ARPU from postpaid subscribers in the Indian telecom sector.

Read More: Postpaid ARPU Fell for Jio, Airtel and Vi in Q1 FY23

Declining Trend of Postpaid ARPU for the Indian Telecom Sector for Several Quarters

To get a good perspective of what's really happening, take a look at this table. The data in the table has been taken from an ICICI Securities note which accumulated data from the latest TRAI (Telecom Regulatory Authority of India) report.

Rs Q1FY22 Q2FY22 Q3FY22 Q4FY22 Q1FY23
Prepaid ARPU 99  102  108 122  129
Postpaid ARPU 215 212 210 201 198

Indian telecom operators need to push their postpaid ARPU up as well. For quarters now, the ARPU has been declining. Telcos don't really interfere with their postpaid plans a lot. Whether 5G would make a difference with postpaid or not is something we will have to wait and watch, as the tariffs haven't been announced yet.

Telecom operators in India will again implement a tariff hike in the prepaid segment in the coming quarters. But whether they will also implement a tariff hike for the postpaid consumers or not is largely unsaid. Vodafone Idea had recently revamped its postpaid plans, but even the new plans don't really reflect any sense of increasing tariffs for the consumers.

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