Market leader Bharti Airtel has increased its pre-paid mobile tariffs by 20 per cent, indicating an end to the cut-throat price-cutting seen in the market over the last 18 months. The operator has hiked tariffs on two plans — Advantage and Freedom — for calls and SMS' sent within the Airtel network.

Users of the Advantage plan will now have to pay 60 paise instead of 50 paise per minute for local and STD calls and 90 paise for calls to landlines. In addition, subscribers will be charged Re 1 and Rs 1.50 for local and national SMS respectively. Existing users will have to pay the new rates after the validity of their existing vouchers end.

Subscribers of the Freedom plan will be charged 1.2 paise for local and STD calls on mobile compared to 1paise at present. The new tariff structure will be effective in the Delhi, Rajasthan, Gujarat, Andhra Pradesh, Kerala and Madhya Pradesh telecom circles. There is no change in any other tariff plan as of now.

“Telecom is probably the only industry where despite the rising inflation, tariffs have been falling unabatedly. Continuously declining margins, high 3G and BWA auction prices, constrained spectrum and rural roll-out aspirations leave us with little choice but to make some price corrections,” an Airtel spokesperson said.

Airtel is the second operator after Tata DoCoMo to hike tariffs Tata TeleServices, which had ushered in a tariff war with its per-second billing-based GSM offering two years ago, has revised the rates for all new subscribers of Tata DoCoMo in every circle that it operates in.

Analysts feel it is just a matter of time before the other telecom operators follow suit. When contacted, other operators said they would wait and watch before responding to Airtel's move to bring tariffs to sustainable levels.

Uninor view

Mr Rajiv Bawa, Chief Corporate Affairs Officer, Uninor, said, “As a smaller player competing against established brands, Uninor will have to remain very attractive to its trade and customers. However, we will watch this move by the industry leader carefully to see the actual changes on the ground. We will support rationality in the industry in a manner that mobile services continue to remain affordable for customers.”

Consumer groups

But consumer groups are unhappy with the development. Telecom Watchdog, a telecom NGO, wrote to the Telecom Regulatory Authority of India to stop the tariff hike. In a letter to the telecom regulator, the NGO said that Airtel was profitable enough to sustain the current tariff levels.

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