Vodafone Idea Will Be Hurt By Delayed Tariff Hike From Airtel and Jio

Vodafone Idea (Vi), India’s third-largest telecom operator, is going to be hurt because of the delayed tariff hikes by Reliance Jio and Bharti Airtel. Vi has been waiting to increase tariffs for so long now, but the operator can’t do it till the time Airtel and Jio push for tariff hikes as well. It is highly unlikely that either Jio or Airtel will be looking to increase tariffs. Both the companies are doing reasonably well and are competing head-to-head when it comes to the active subscriber base. Thus, they wouldn’t want to hurt their position in the market by increasing tariffs all of a sudden.

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Why Is Vodafone Idea Waiting For Airtel and Jio to Increase Tariffs?

Vi needs to wait for the other two private operators before it increases tariffs. This is because if Vi increases tariffs and none of the other operators follows, a lot of users will be looking at Jio or Airtel for cheap tariff plans, and Vi would further lose subscribers to Airtel and Jio.

It is worth noting that Vi has lost a ton of its subscribers to Airtel already because the latter provides prepaid plans at a slightly lower tariff and offers better coverage. Vi can’t afford to lose more subscribers in a jiffy since the telco hasn’t added a net positive number of subscribers for consecutive quarters now.

Why Aren’t Jio and Airtel Helping Vi By Increasing Tariffs?

Neither of the telcos will increase tariffs at a point when the competition is for gaining a larger market share. Since Airtel has been adding more subscribers than Jio for consecutive months, the telco wouldn’t jeopardise the growth rate by increasing tariffs.