Mobile tariffs may go up further: Sunil Mittal

Within days of hiking mobile tariffs in some segments, Bharti Airtel today hinted that charges might go up "significantly" in the near future in view of rising operating costs.

"The pressure on this industry will be acute as the operators will have to serve the rural markets, as well as low-end customers, who use only voice calls and SMSes," Bharti Group CEO and Managing Director Sunil Mittal said, adding that tariffs will have to go up significantly in the near future.

This correction in tariffs is required to compensate for the company's rural operations, as the cost of operations has gone up exponentially, Mittal said on the sidelines of a function here.

In recent years, India has enjoyed one of the lowest telecom tariffs in the world, with some operators offering a per second pulse at the rate of half a paise only, while others are offering a call rate of one paise per second.

The revenues of most of the operators have come under pressure due to the high cost of operations and low tariffs amid increased competition. There are 12-14 players in each circle, all vying for market share in the mobile telephony space.

Last month, leading operators, including Airtel, Vodafone Essar, Tata DoCoMO and Reliance Communications, hiked their tariffs, by as much as 20% in some plans.

Airtel had raised the tariffs for its 'Advantage' and 'Freedom' pre-paid tariff packages, which are based on per minute billing, to 60 paise per minute for local and STD mobile-to-mobile calls. Earlier, the rate was 50 paise per minute in this category.

Pursuant to the tariff increase, telecom regulator TRAI last month sent letters to all the companies that hiked tariffs, seeking to ascertain the reasons for the increase.

Meanwhile, commenting on Bharti's operations in Africa, Mittal said tariffs in these markets are very high and the company has made some corrections.