The party is over for mobile users, with top operators, including Bharti Airtel and Idea Cellular, cutting down on freebies, discounts and pre-paid card validity period.

While technically, there is no hike in existing per minute tariffs, mobile users will end up paying 20-30 per cent more following the withdrawal of these discounts.

Shorter validity

For instance, an Airtel subscriber using a Rs 70 voucher will now get 125 minutes of talk time instead of 135 minutes earlier.

In some circles the validity of low-value vouchers has been reduced from 14 days to 10, which means users will get fewer days to use up the voucher value. Also, full talk-time vouchers have gone up in price from Rs 30 to Rs 40-60, depending on the circle.

None of the operators was, however, forthcoming about details of the change in tariff schemes despite it affecting millions of users. Idea Cellular only said it has withdrawn some promotional schemes and tariff plans that were available in the market for the past couple of years.

“The operational costs for these tariff plans have gone up substantially, while subscriber additions are not happening the way they should be,” said an Idea Cellular official. Vodafone India said that this was inevitable given the sharp input and energy price increases in the country. “We are inclined to follow to maintain consistency and a competitive position,” a Vodafone India spokesperson said.

Reliance Communication said it has already hiked voice call tariffs from 1.2 paise to 1.5 paise, in addition to increasing charges for special tariff vouchers. Gurdeep Singh, CEO (Wireless Business) RCom, said: “The recent hike by other players is welcomed and it appears that they are reacting to RCom’s earlier initiatives.” The change in tariff plans is being implemented across the country in phases but the extent of impact varies from circle to circle.

Analysts said this could be but the beginning and operators could soon hike voice-call tariffs. “Operators have to account for the increased costs of spectrum sale last month and another auction coming up in March.

“Capping free minutes as well as call vouchers is essentially working around the benefits extended to consumers but understandably, call prices will also go up in a phased manner if the industry has to keep sustainable service delivery,” said Sivarama Krishnan, Executive Director, PwC India.

Hemant Joshi, Partner, Deloitte Haskins & Sells, said that hiking voice tariffs in some key circles would make a difference in the revenue realisation for the telcos. “Although consumers will not be happy initially, they (especially urban users) might be ready to pay a little more for better quality of service from the telcos. The hike in voice prices will also help the operators in pricing the data services appropriately,” he said.

Consumers complain

Consumer groups, meanwhile, have complained to the Telecom Regulatory Authority of India to fix a ceiling for tariffs to prevent more hikes in the future.

“This hike in a cartelised manner is illegal, unjustified, and arbitrary. In the past also, we had written to TRAI to put a ceiling on the tariff at the current levels so that the operators cannot increase the tariff in an arbitrary manner,” said Telecom Watchdog, a Delhi-based consumer group.

(Inputs from Rajesh Kurup in Mumbai)

(This article was published on January 23, 2013)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.