Why is the Removal of Cheaper Postpaid Plans a Good Move for Both Telcos and the Industry?

Incumbent telcos like Bharti Airtel and Vodafone Idea phased out the entry-level or cheaper postpaid plans priced at Rs 199, Rs 299, Rs 349 and so on earlier this year. And it’s a good move from them as the industry has been reeling ever since the entry of Reliance Jio back in 2016. While Reliance Jio is not focusing much on the postpaid segment, it’s Bharti Airtel and Vodafone Idea battling for the top spot with the former leading the pack. Airtel is now offering just four postpaid plans to the customers priced between Rs 499 and Rs 1,599, while Vodafone Idea’s postpaid plans still at Rs 399 and goes all the way up to Rs 1,999. Why is the removal of entry-level postpaid plans a good move for the telcos and the industry alike?

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Bharti Airtel’s Attempts at Increased ARPU

One of the recent moves that Bharti Airtel has adopted to bring a positive change in its ARPU is through the removal of low paying postpaid plans like Rs 399. Now the Airtel postpaid subscribers have limited choices starting from Rs 499, thus leading to a better ARPU for the company. The introduction of minimum recharge plans is also a move on similar lines, as it requires the customer to pay the company repetitively on regular intervals.

Vodafone Idea Also Aims Increased ARPU

Another telecom operator, Vodafone Idea, have also made similar moves in the market and have been eyeing improved ARPU since quite some time now. Vodafone Idea has also introduced minimum recharge plans for its subscribers, meaning that now customers will have to recharge their accounts once in a month to keep their services running. Vodafone has also made some changes to its postpaid plans, thus signalling a path towards increased ARPU. Furthermore, the company is providing the Rs 299 postpaid plan in just a few circles at the moment.