Telecom industry is facing substantial distress due to the outbreak of COVID-19. As of result of the abnormal rise of the deadly virus, the telecom industry will witness tariff hike, and it will be unavoidable as the telecom operators are already facing financial distress amid difficult times. Prashant Singhal, emerging market Technology, Media & Entertainment and Telecommunications Leader stated that the analysing the current scenario, tariff hike will not be done immediately. However, the first round of tariff hike might be done in the coming six months. He also stated tariff hike must be done as soon as possible to aid the telecom operators who are facing distress in the crisis time.
Tariff Hikes Might be Done in Two Rounds over Next 18 Months
As reported by PTI, Singhal also stated that two rounds of tariff hikes must be expected over the next 12 or 18 months. However, taking account of the current economic situation and affordability factor, the first round of tariff hike should likely happen in the next six months. The first round of tariff hike will ensure sustainability the telecom market and help the telecom operators to provide seamless telecom services to subscribers and keep them connected amid difficult times.
ARPU Increase will Rely on Tariff Hikes
Prashant Singhal also added that the telecom industry is expecting ARPU growth from 60 % to 80 % over the next two or three years. However, the growth of ARPU can happen by tariff increase and switching from fixed price plans to data based on usage and consumption.
Telecom Operators Had Increased Tariffs in December 2019
Telecom operators have already started tariff hike process from December 2019. The price hike done by telecom operators in December 2019 was positively accepted by subscribers. Also, if two rounds will be done in the next 12 or 18 months, the telecom industry will revive, and subscribers will enjoy seamless telecom services, and telecom operators will not be financially distressed. Singhal also stated that tariff hike was inevitable and the outbreak of Covid-19 pushed the tariff hike process in future. However, the government is speeding up the process to revive the telecom sector and the entire economy.