If monthly Arpu (average revenue per user) is like a currency to evaluate the health of a telecom operator, subscriber numbers are its mainstay. Recent developments establish that the two most critical metrics in the telecom universe - Arpu and subscriber numbers - are two sides of the same coin, with tariff being the proverbial X factor.
After 30 months of holding on to the same tariff levels, fearing that any hike would trigger loss of customers, companies decided to bite the bullet in July this year and raised prices across the board.
The subscriber churn has not stopped ever since. In fact, India's telecom market has thrown up more surprising numbers than anyone was willing to predict.
Not surprisingly, the industry is not rushing into a debate around the quality of subscribers, the difference between pre-paid and post-paid customers, and the cost of acquisition of users at this point. The next round of tariff hike, though necessary to inch closer to the international levels, can wait.
A senior executive at a leading telco told Business Standard recently that his company would not risk losing more customers by raising tariffs. For good reason.
Subscriber churn
Reliance Jio, Bharti Airtel, and Vodafone Idea (Vi) have cumulatively lost 23.07 million subscribers in the second quarter (July-September) of FY25. Meanwhile, public sector telecom operator Bharat Sanchar Nigam Ltd (BSNL) saw its fortunes rise with 6.3 million new mobile customers.
Breaking a record logjam of two and a half years, all three private sector telcos raised tariffs. Bharti Airtel and Vi announced a hike in mobile tariffs by up to 21 per cent, while Jio raised them by 12-25 per cent. BSNL stayed away from any tariff hike.
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