Mobile phone calls to get expensive
Voice tariffs will go up as debt-laden telecom operators start revising rates to factor in higher costs and increased expenses. Airtel, the country’s largest mobile operator, has said it will continue to cut discounted minutes and raise its voice and data tariffs to meet rising costs and improve revenues. Reliance Communications (RCom) has already increased tariffs, while Vodafone and Idea are expected to follow suit.
RCOM has increased the headline tariffs (the official rates filed with regulator) by 7 per cent, while cutting benefits in discounted tariff plans by up to 20 per cent.
Industry analysts point out that there is a gap of nearly 30 per cent–40 per cent between the headline tariffs and the actual market rates on certain packages. Spectrum auctions and the high prices paid by top telcos are among the main reasons behind the change in tariff strategy. Earlier this year, Vodafone’s India MD & CEO Marten Pieters stated his agreement that the higher spectrum charges were adding to pressure. “The auction raised over Rs 61,000 crore for the government, but much of this will end up as debt on the balance sheets of operators. Such high industry indebtedness will hurt operators' ability to invest in the rollout of new technologies and invariably result in higher prices and reduced service levels for consumers,” he said.