Synopsis

Bharti Airtel has removed four prepaid plans, impacting subscribers of the Rs 299 pack. These subscribers now face a higher cost for similar services. The company aims to increase its average revenue per user through this strategy. This move may signal a wider industry trend towards increased telecom tariffs. Airtel's profit rose significantly in the recent June quarter.

Bharti Airtel has withdrawn four prepaid plans priced at Rs 299, Rs 579, Rs 619 and Rs 649, leaving subscribers of the popular Rs 299 pack with fewer and more expensive options.

The reshuffle leaves the entry-level Rs 199 and Rs 219 plans unchanged. However, subscribers on the Rs 299 plan will now have to opt for the Rs 349 pack, translating into a price increase of around 16%.

While Airtel has not officially commented on the move, people aware of the development said the company is looking to drive sustained growth in average revenue per user (ARPU). They said users on the Rs 299 plan often exhaust their data allowance and end up buying top-ups or recharging again. The Rs 349 plan, in comparison, offers unlimited 5G data.

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Experts said the move could signal a broader industry shift towards higher tariffs as telecom operators focus on improving ARPU and realisations.

Bharti Airtel management had indicated during its earnings call last week that there was scope to raise tariffs on plans offering unlimited data at lower price points.

Responding to a question on whether Airtel needed to raise tariffs despite healthy growth, Executive Vice Chairman Gopal Vittal said the company’s reference to tariff repair was essentially about the structure of mobile plans.

“Which means that for a very low level of pricing, you get unlimited data, and that means ARPU is capped. That to me is not a healthy way to operate it because if you look at it, and we have talked about this before,” Vittal said.

He said every market has offerings across small, medium, large and extra-large categories, making it necessary to have “sensible price architecture” in mobile services.

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Airtel India’s ARPU rose 5.6% to Rs 264 in the first quarter of the current fiscal from Rs 250 a year earlier, the highest among major telecom operators.

Experts said Airtel’s move could pave the way for other telecom operators to follow suit as the industry seeks to improve monetisation.

Bharti Airtel reported a 37.3% increase in profit after tax to Rs 8,167 crore in the June quarter, driven by strong growth across its India and Africa operations. Revenue from operations rose 18.3% to Rs 58,539 crore from Rs 49,462.6 crore in the year-ago quarter.

(With PTI inputs)