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Friday, January 25, 2013

Airtel and Idea hikes call rates...........

Bharti Airtel and Idea hike call tariffs

While Bharti Airtel has doubled the call rates from Re 1 per minute to Rs 2 per minute, Idea has also gone for a steep hike from 1.2 paise per second to 2 paise per second
 
While Bharti Airtel has doubled the call rates from Re 1 per minute to Rs 2 per minute, Idea has also gone for a steep hike from 1.2 paise per second to 2 paise per second

In a blow to consumers, both Bharti Airtel and Idea CellularBSE -0.53 % have increased their call tariff rates by nearly 100 per cent. While Bharti Airtel has doubled the call rates from Re 1 per minute to Rs 2 per minute, Idea has also gone for a steep hike from 1.2 paise per second to 2 paise per second.

According to ET Now, the substantial increase in rates indicates that pricing power has returned to the telecom sector, with incumbents likely to have more flexibility going forward.

In a written reply to ET Now, Bharti Airtel said that the hike was inevitable and revision in rates is in line with increasing costs. "We have been reiterating that increase in prices is inevitable, which is reflected from the fact that despite rising costs, tariffs have been falling over the past 12 quarters," Bharti Airtel said in a statement.

A source with direct knowledge separately told Reuters that Bharti Airtel is reducing free minutes by up to a quarter and has increased prices of some call vouchers for prepaid customers by Rs 5-15.

The call price increase will be extended to all of 22 telecommunications zones in a phased manner, the source said, declining to be named.

The plan to up call rates has been submitted with the telecom regulator TRAI. ET Now did not rule out the possibility of an intervention from TRAI on the same. With an aim to protect consumer interests, TRAI may intervene in the call rate hike decision, ET Now said.

Earlier this month, Bharti Airtel and Vodafone hiked tariffs for 2G data services. Airtel revised its 1GB 2G data plan from Rs 100 to Rs 125.

"This nominal price revision is subject to rate elasticity, customer demand and supporting cost structures. Our recent revision...is an increase of only 2-3 paise per MB. It continues to be an excellent value proposition for our customers," an Airtel spokesperson had said.

Vodafone too has made similar changes in the monthly plans and has reduced data limits available under various prepaid plans.

While the Rs 95 plan (28 days validity) is now available for Rs 124, others plans allowing 250 MB data usage and 150 MB usage have been reduced to 150 MB and 100MB, respectively.