In the last few months, the Indian communications industry has seen significant changes since two of the biggest operators, Airtel and Jio, have announced substantial increases in their mobile rates. The move aims to increase their ARPU (average revenue per user) (ARPU), which has decreased over the last few years. The tariff increase is likely to significantly impact mobile phone users, who could face a boost of as high as 20% on their mobile bill.
In this piece, we’ll explore the causes of the tariff increase, its impact on consumers, and its potential implications for the telecom sector in general.
Reasons Behind the Tariff Hike
Airtel and Jio have both cited the necessity to fund 5G technology and maintain high-quality services as the main reason for the increase in tariffs. They claim that the higher revenues will be used to improve their companies’ infrastructure, increase the quality of their networks, and grant superior service to customers.
However, critics say that the increase in tariffs is due to businesses wanting to boost their profits rather than the necessity of investing in services. They argue that the companies have seen significant earnings over the last few years, and the tariff hike will most disproportionately be felt by those with low incomes who rely on low-cost mobile plans.
Impact on Consumers
The price hike is expected to have a major impact on mobile users, with many having to pay a boost of as high as 20% on their monthly mobile bill. This could be a major burden on many users, especially those already trying to survive.
The effects will be felt the most by those with low incomes who depend on low-cost mobile plans to keep in touch with loved ones and access essential services. They will likely pay more for mobile service or cut back on other life-related costs.
Potential Consequences for the Telecom Industry
The hike in prices imposed by Airtel and Jio could set the bar for other operators to follow similar practices. This could result in an important improvement in the cost of mobile services worldwide and could have wide-ranging effects on the business.
On the other hand, a higher income could result in more efficient services and infrastructure that mobile customers can access. However, it could also improve mobile use and shift towards other methods of communication, including landlines and internet-based services.
Conclusion
The increase in tariffs from Airtel and Jio is a significant advancement in the Indian telecom industry. Although the companies say the hike is required to keep their services high-quality, critics claim that it will disproportionately affect people with lower incomes and improve mobile use.
As the industry continues to grow, however, it remains to be assessed how the hike in prices will affect mobile users and the entire industry. One thing is for certain, however: the days of low-cost mobile service may soon come to an end.