Airtel increases the price of its cheapest plan; Check

Recently, Airtel suspended its cheapest top-up plan in Andhra Pradesh, Bihar, HP, Rajasthan, Northeast, Karnataka and UP-West. With this, the base plan rate offered by telecommunications operators has increased by 57 percent. Now instead of Rs 99, users need to pay Rs 155, which is now the basic plan for prepaid users.

Airtel is adjusting rates to increase revenue and margins for the company. Last year, Airtel discontinued its Rs 99 plan and delisted it in Haryana and Odisha. Now, the plan is unavailable in more circles, leading to the increase in the entry-level plan to Rs 155.

The Airtel Rs 99 plan offered limited talk time with a validity of 28 days. However, the upgraded base plan of Rs 155 will offer unlimited calls, 300 SMS, and 1GB of data for 24 days. The Rs 99 was a bit affordable and offered more validity; the new base plan will definitely strain the user's pocket a bit. Especially for those users who use Airtel as a secondary SIM.

Airtel is also expected to drop Rs 99 from more circles in the future. Telecom giants like Jio and Airtel will switch and increase the prices of their existing plans by 10 percent. A Business Insider report suggests that telecom operators, including Jio and Airtel, could announce a 10 percent rate hike in the next 3 years, i.e. Q4 of FY23, FY24 and FY25. This could further increase the prices of mobile plans every fourth quarter of the next few years.

It is suggested that the increase in fees is due to increasing pressure on companies' revenues and margins. The average revenue per user (ARPU), a crucial indicator of a telco's performance, increased moderately for Airtel, Vodafone Idea and Jio in the third quarter. Now, with the price hike, the ARPU is said to experience a significant increase.

Furthermore, the revenue is also based on the subscriber base. In the past few months, both Airtel and Jio have significantly increased their subscriber base. This increased the ongoing competition between the two telecommunications companies to attract more users. Jio and Airtel are also currently in head-to-head competition for 5G as they are the only two telcos offering 5G services in India.