Prepaid Subscribers Said to Be Recharging Monthly Plans After the Tariff Hike

According to executives and channel partners, prepaid subscribers are actually choosing monthly plans over the 84-day or yearly prepaid plans

By December 26th, 2019 AT 11:21 AM
Highlights
  • Airtel, Jio and Vodafone Idea announced tariff hike earlier this month
  • The 84-day plans from telcos have seen the major hike
  • More tariff hikes are expected in the coming months

It seems like prepaid subscribers of the telecom operators are moving to monthly recharges after the recent tariff hike in the Indian telecom industry. A new report now says that the tariff hike is forcing the users who are on a tight budget to choose monthly plans over the long-term plans. An ET Telecom report highlights that some customers are even opting data-only packs from the telcos as they are cheaper than the unlimited plans. After the tariff hike, Vodafone Idea and Bharti Airtel are charging Rs 149 for the entry-level unlimited plan, whereas Reliance Jio is collecting Rs 129 from the users for the basic plan. The major hike happened to the plans which used to offer benefits for 84 days at less than Rs 400.

Prepaid Users Opting Monthly Plans Over Long-Term Ones

ET Telecom spoke with executives and channel partners regarding the recent price hike from telcos. According to them, prepaid customers are now opting monthly plans over the long-term plans. “The customer who could afford a mobile plan of about ?300 for 84 days is now recharging for the one-month plan because he cannot afford the ?500-plus expense,” said a Mumbai-based distributor for Bharti Airtel to the publication.

This could be the reason behind Reliance Jio discounting its yearly plan of Rs 2,199 to Rs 2,020 for a limited period. For the unaware, the Mukesh Ambani-owned Jio introduced Jio 2020 offer a couple of days ago to offer the yearly prepaid plan on discount. The report also added that Bharti Airtel is also providing discounts on yearly plans, but we did not spot any such offers for now.

Data Recharges are Also Becoming Popular

Telecom operators in the country announced tariff hike way before implementing them. For example, Vodafone Idea and Bharti Airtel gave three days to the customers so that they can queue the older plans. Reliance Jio even pushed subscribers to queue the prepaid recharges to avoid the tariff hike for a longer period. “In a price-sensitive market, it will take a few months for consumers to understand the effect of the new tariffs,” the executive added.

Besides the monthly plans, prepaid users are also going with the data-only plans. For instance, Jio users can choose the Rs 251 data voucher, which provides 2GB data per day for 51 days. On the flip side, Vodafone Idea and Airtel are also providing 6GB of data with 28 days validity under Rs 100 itself.

“An Uber driver will only recharge his GPS device so that he can run his taxi and may not recharge his personal device for calls,” said a Vodafone store manager.

This is actually good news for telecom operators as the ARPU will grow at a rapid pace. Analysts predict the ARPU of Airtel to rise to Rs 145-Rs 150 in the next two quarters, whereas Vodafone Idea will have an ARPU of Rs 143 from Rs 107.

Earlier, prepaid subscribers used to get an 84-day plan under Rs 400. Airtel, Vodafone Idea and Reliance Jio had a Rs 399 prepaid recharge offering up to 1.5GB data per day for 84 days. But now, the price of the same pack has been hiked to Rs 598 on Airtel, Rs 599 on Vodafone Idea and Rs 555 on Reliance Jio. So all these subscribers will get a monthly plan of either around Rs 250 to stay active. The tariff effect may not be immediate, but we believe that telcos will have a good time in the coming months.

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Chakri is a go-to guy for your next smartphone recommendation. Back in his engineering days, he used to play with smartphones by installing custom ROMs and that passion got him into the tech industry. He still goes nuts about a smartphone knocking his door for review. Currently managing everything at Telecom Talk, Chakri is trying to master PUBG Mobile in his free time.

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