Vodafone raised postpaid call rates from 1 paisa per second to 1.2 paise per second in Mumbai. Others are likely to follow suit.
Vodafone on Tuesday raised postpaid tariffs in Mumbai by 20%, setting stage for rivals to follow suit. The No 2 operator said its 1-paisa-per-second calls will now cost 1.2 paise per second in Mumbai, its second-largest market in India with 58.02 lakh subscribers as of March 2012.
There could be more in store, warn experts. Bharti Airtel, for instance, has already said another round of tariff hike was inevitable given marginal improvement in average revenue per user after the first industry-wide prepaid tariff hike of 20% last July.
However, Himanshu Kapania, managing director of Idea Cellular, said his company is not planning to hike postpaid tariffs. A Vodafone source said there are no plans to hike tariffs for enterprise customers. “No decision has yet been taken on extending this tariff hike to corporate customers or customers in other circles. This hike will be applicable only to new Vodafone billing customers and customers who are not currently on a special tariff plan,” the source said.
Recent recommendations of the Telecom Regulatory Authority of India on spectrum refarming and 2G auction reserve price have raised fears that tariffs will have to shoot up to offset licence and spectrum acquisition costs.
Predatory tariffs have eroded telecom players’ profitability over the last couple of years.
Rajan Matthews, director, Cellular Operators Association of India, the apex body of GSM technology mobile phone operators, said the hike was long overdue.
“With inflation rising, every sector has increased prices, except the telecom sector. Vodafone’s move could lead other operators to tweak tariffs too,” he said.
Matthews said Vodafone’s single-circle hike is aimed at testing subscriber reaction and if customers take it well, the hike may be extended to other circles.
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