Vodafone Idea, which was heavily rumoured to hike tariff prices in recent months, has now reportedly postponed the plan. A new ET Telecom report says the financially struggling telecom operator has pushed back its plan of raising tariff prices to Q1 FY22. Vi might now hike the prices of prepaid and postpaid plans by the end of the April-June quarter. Initially, Vi was planning to increase tariff prices by the end of this quarter (Q4 FY21), but the launch of new JioPhone offers by Reliance Jio means the telco is left with no other option other than the postponement of tariff hike. If Vodafone Idea goes ahead with tariff hike, there are high chances of its 2G subscribers migrating to Reliance Jio.
Tariff Hike May Not Happen in India Anytime Soon
With Vodafone Idea's decision to push back the tariff hike, the current prices are here to stay, at least for another 3-4 months which is a good sign for the subscribers. The last tariff hike happened in December 2019 and it made brought the much-required relief to the telecom sector financially. The COVID-19 pandemic also helped the telcos to settle down financially and increase the ARPU with various plans focussed on data-savvy users.
As of December 31, 2020, Vodafone Idea has the lowest Average Revenue per User (ARPU) among the private telcos. Airtel is leading the chart with a very decent Rs 166 ARPU, while Jio is second on the list with Rs 151 ARPU.
The ET Telecom report says Vodafone Idea's top management decided to go against another tariff hike because of the new offers from Reliance Jio. New JioPhone users can avail a yearly plan at Rs 1,499 and a two-year plan at Rs 1,999. It is an affordable proportion and a lot of customers will be inclined towards it.
Vi still has a lot of 2G subscribers under its belt. If it goes ahead with the tariff hike now, there are heavy chances of its 2G subscribers migrating to JioPhone. Reliance Jio is also offering a unique tariff plan to its existing JioPhone users as they can avail a Rs 799 plan that offers benefits for one year.
Bharti Airtel and Reliance Jio already stated they would not hike tariff prices in the industry first, so it is all on the shoulders of Vodafone Idea. If Vi increases the prices, then Airtel and Jio will join the same train.