Bharti Airtel chairman Sunil Bharti Mittal has hinted at a significant hike in tariffs soon. At an event, Mittal asked Airtel subscribers to ‘prepare to pay a lot more’. Mittal suggested that instead of getting 16GB data for Rs. 160, users should get only 1.6GB. This means Airtel looks to ask its subscribers Rs. 100 for every 1GB consumed.
“You either consume 1.6GB of capacity per month either at this price point or you may prepare to pay a lot more,” Mittal said at an event, according to PTI. “We don’t want $50-60 (roughly Rs. 3,700 – Rs. 4,400) like the US or Europe but certainly $2 (roughly Rs. 160) for 16GB a month is not sustainable.”
According to PTI, Mittal said that asking for Rs. 160 for 16GB of data was a tragedy for the business. Consumers should only be offered 1.6GB of data at this price point. This means Mittal expects consumers to pay Rs. 100 per GB. To put things into perspective, currently Airtel offers 1GB daily data for 24 days for Rs. 199. In the future, Airtel may only offer 2.4GB data for the whole validity period of this plan.
Mittal adds that the ideal average revenue per user (ARPU) should be at Rs. 300 per month for the business to be sustainable, and the Bharti Airtel chairman wants the ARPU to cross at least Rs. 200 in six months. “We need a Rs. 300 ARPU in which you will still have lower end at Rs. 100 a month with decent amount of data. But if your consumption is largely around watching TV, movies, entertainment and depriving other vital special services networks, then you need to pay for that,” Mittal said. He made these statements at a book launch event of Bharti Enterprises executive Akhil Gupta.
The PTI report says that Airtel has seen an increase in ARPU to Rs. 157 in June this year, after it increased the tariffs last year in December. However, to reach a sustainable model, Airtel looks to increase the prices even further.
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