New Delhi
The prices of telecom services in India may increase further in the coming times. Telecom companies are planning to increase tariffs regularly in future so that they can improve their revenue. Companies have earlier increased tariffs like December 2019 November 2021 and July 2024.
Revenue growth plan
According to the report, telecom companies will increase prices per user to increase average revenue (ARPU) per user. This means that consumers will turn to the premium plan which will increase the revenue of the companies. The report also stated that the Indian telecom sector is currently undergoing a significant phase where competition has decreased and companies are now planning to increase tariff more often. According to the report, the returns are still low in view of investment and customer data consumption in the industry, so companies will increase the tariff more often in the coming years.
Companies have doubled the revenue
The report also stated that the revenue of telecom companies has almost doubled in the last five years. Their profitability is also improving the operational costs are getting stable and margins are getting stronger. After the arrival of 5G services, companies have reduced their capital expenditure, which may increase free cash flow in FY 2025–26 and 2026-27.
2G customers decline
According to the report, with the increasing use of 4G and 5G services, the number of 2G customers in India is steadily decreasing. The number of 2G customers can be negligible over the next five to six years. Currently 25 crore customers are using 2G services and out of these Vodafone Idea have 40 percent 2G customers while Airtel has 23 percent 2G customers.
Trend towards expensive data plan
Telecom customers are now moving from 2G to 4G services and the number of postpaid customers is also increasing. This is improving the overall revenue per user. Apart from this, the consumption of data is also increasing and customers are now choosing a high -priced data plan. The demand for services like international roaming and OTT subscription is also increasing.
Extension in India will be challenging for Starlink
Alan Musk’s satellite internet company Starlink now wants to expand its services in India. Starlink is also talking to Vodafone Idea after compromising with Airtel and Reliance Jio. However, the report said that Starlink may face many challenges in India. Due to regulatory barriers, high imports and cheap broadband services in India, it can be difficult to fix prices for Starlinks correctly.
Expansion of satellite communication
India’s satellite communication field is also growing rapidly. Government initiatives such as Telecom Technology Development Fund Scheme and Telecom Act-2023 have promoted the sector. Open FDI policies, progresses in quantum satellite technology and expansion of Visat networks are promoting innovation in this field. Thus, the telecom sector of India can be more expensive in the future, but with this many new technical and business initiatives can also be revealed.
