Airtel, Jio, Vodafone Idea Signal Easing Of Price War With New, Costlier Prepaid Plans
While Airtel and Vodafone Idea’s new prepaid plans will be effective Dec. 3, Reliance Jio’s will roll out on Dec. 6.
India’s three largest telecom firms on Sunday announced new and costlier prepaid plans, signalling an easing of a price war that started after Asia’s richest man entered the sector in 2016.
Bharti Airtel Ltd., controlled by Sunil Bharti Mittal, will hike mobile phone tariffs by as much as 41 percent while Mukesh Ambani’s Reliance Jio Infocomm Ltd. will raise rates by as much as 40 percent. Vodafone Idea Ltd., a joint venture of the U.K.'s Vodafone Group Plc and billionaire Kumar Mangalam Birla’s Aditya Birla Group, too hiked prices by a similar quantum.
Airtel and Vodafone Idea’s new plans will be effective Dec. 3; Reliance Jio's will roll out on Dec. 6. The incumbents raised the minimum monthly recharge plan to Rs 45 from Rs 39 earlier, while the upstart didn’t disclose its plan details.
Reliance Jio, however, said that its customers will get up to 300 percent more benefits under the new prepaid plans and will offer fair usage policy for outgoing calls to rival telecom networks. Airtel and Vodafone Idea will charge for outgoing calls beyond a certain threshold at 6 paise per minute—in line with the much-debated interconnection usage charges, or IUC.
Here’s a look at the new prepaid plans announced by Airtel and Vodafone Idea:
The telecom companies had in recent weeks indicated that they would hike tariffs, in reaction to an adverse ruling by the Supreme Court on adjusted gross revenue. The AGR verdict has the government weighing a telecom bailout package—a move opposed by Reliance Jio.
Also Read: Airtel, Vodafone Idea Move Supreme Court Seeking Review Of AGR Verdict
But Vodafone Idea runs the risk of liquidation if the government doesn’t ease off on demands for mobile spectrum fees, Vodafone Group’s Chief Executive Officer Nick Read had said on Nov. 12, days before the telecom firm posted the biggest loss in India’s corporate history.
Airtel too posted a record loss in the second quarter of 2019-20 as it set aside cash for AGR dues, and expressed doubts on its ability to continue as a going concern.
Reliance Jio, meanwhile, remained profitable in the September quarter, and is on course to become virtually debt-free by March 31, 2020.