Mobile phone users in the country are expected to shell extra money to recharge their existing numbers as telecom service providers are likely to increase their tariffs soon.
Recently, Airtel, one of the oldest mobile service providers in the country, had announced to increase the tariff of pre-paid connections by 20 to 25 per cent from November 26. And, other telecom companies are also expected to follow the suit.
"Bharti Airtel has always maintained that the mobile Average Revenue Per User (ARPU) needs to be at Rs 200 and ultimately at Rs 300, so as to provide a reasonable return on capital that allows for a financially healthy business model," the telecom operator said in a regulatory filing.
"We also believe that this level of ARPU will enable the substantial investments required in networks and spectrum. Even more important, this will give Airtel the elbow room to roll out 5G in India," the company had stated.
This revision is part of their "rebalancing" of tariffs, the filing said.
Airtel has increased the minimum voice tariff plan to Rs 99 from Rs 79. The plan comes with 28 days validity and benefits like 50 per cent more talk time worth Rs 99, 200MB data, 1p/sec voice tariff.
Vodafone Idea CEO Ravinder Takkar, during a recent post-earnings investor call of the company, had asserted that tariff hike remains critical for continued revival of the sector.
Takkar said the company has started working on raising mobile tariffs, and it is expected to be in place very soon.
"Some activity on tariff hikes has started to happen. Tariff hikes which are the next important step will also take (place) soon. For us, particularly as a company, we will not shy away from raising tariffs," Takkar had said.
The telecom sector is buoyant and upbeat after the government recently approved a blockbuster revival package that includes a four-year break for companies from paying statutory dues, permission to share scarce airwaves, change in the definition of revenue on which levies are paid and 100 per cent foreign investment through the automatic route.
The measures -- aimed at providing relief to telecom service providers that have to pay thousands of crores of rupees in unprovisioned past statutory dues -- also include the scrapping of Spectrum Usage Charge (SUC) for airwaves acquired in future spectrum auctions.
(With agency input)