Bharti Airtel hikes mobile tariffs, others may follow

After offering low tariffs for some time, country's biggest telecom operator Bharti Airtel today hiked rates by up to 20% for pre-paid users in certain packages across several circles.

This could put new telecom operators at a disadvantage as they may find it difficult to increase tariffs because their customer base is low and need to remain attractive to woo new users. However, other major telecom operators (old players) are expected to follow suit.

Beginning today, users of 'Advantage' and 'Freedom' pre-paid tariff packages, which are based on per minute billing, will have to pay 60 paise per minute for local and STD for mobile-to-mobile calls, airtel said. Earlier, it was 50 paise per minute for this category.

For mobile-to-landline calls, the revised tariff is 90 paise local and STD calls.

"Telecom is probably the only industry where, despite increasing inflation, tariffs have been falling unabated. Continuously declining margins, high 3G and BWA auction prices, constrained spectrum and rural roll-out aspirations leave us with little choice but to make some price corrections," Bharti Airtel said in a statement.

Further, SMS charges have also gone up to Re 1 and Rs 1.5 for local and national SMSes, respectively. Existing users will have to pay for new rates after the validity of their existing voucher ends.

"We are committed to enhance the value for our customers through continued investments in network, technology, customer experience and life enriching services," the company added.

When contacted a new operator Uninor said that it will wait and watch the situation.

"As a smaller player competing against established brand, Uninor will have to remain very attractive to its trade and customer.

"However, we will watch this move by the industry leader carefully to see the actual changes on the ground. We will support rationality in the industry in a manner that mobile services continue to remain affordable," Uninor Chief Corporate Affairs Officer Rajiv Bawa said in a statement.

Bharti Airtel added 2.12 million mobile subscribers in June, taking its total to 169.2 million, data from Cellular Operators Association of India said.

India is the world's second-biggest mobile market after China. Bharti, the fifth-largest mobile operator globally by subscribers, operates in 19 countries in South Asia and Africa.