Cellphone Plans In India Have Gone Up By Over 40%

Dhir Acharya - Dec 04, 2019


Cellphone Plans In India Have Gone Up By Over 40%

India has been a wonderful country for those who own a mobile phone as it offers mobile plans at prices tens of times cheaper than the rest of the world.

For years, India has been a wonderful country for those who own a mobile phone. While most telecom providers around the world charge from Rs 358 to Rs 716 per gigabyte of cellular data, Indian operators offer that for tens of times cheaper.

If you pay another Rs 143, you have daily mobile data of one gigabyte for a month along with free nationwide phone calls.

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You may be wondering how they can do that. Three years ago, the richest man in the country introduced his telecom network Reliance Jio that offered unlimited calls as well as 4G data plans at low prices. Airtel and Vodafone revised their tariffs to go against Jio, but that drained their pockets.

So this time, the providers are changing to make mobile plans in India less attractive while maintaining them as much better than in other markets.

Reliance Jio, Bharti Airtel, and Vodafone Idea are the three largest telcos in the country, which account for more than 90 percent of the total subscriber base that includes over 1.1 billion users. The three have raised their tariffs by 40 percent for prepaid users.

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Vodafone’s revised plans start from Rs 19 for daily usage, going up to Rs 2,390 for one year, which is around 42 percent higher than their previous offerings. The new tariffs are effective starting today.

Meanwhile, the new tariffs for Bharti Airtel users are similar although the provider says that it will offer generous calling and data benefits.

These changes are meant to make up for the huge losses the pair reported in November. As of September, Vodafone and Airtel lost $7.1 billion and $3.2 billion, respectively.

On the other hand, Reliance Jio said that it will launch new plans too, which will increase 40 percent cost to strengthen the telecom sector while keeping consumers the center of everything. Its revised plans will be effective starting Friday.

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Jio’s announcement comes following a decision from two months ago, where it decided to raise the prices as other providers kept the idea of levying an “interconnect fee.”

When users call from a network to another, the first operator has to pay an amount to the second one, called interconnect fee. This fee before 2017 was Rs 1.29 per minute. In 2017, the interconnect fee in India was reduced to Rs 0.57 per minute, and the telecom regulator said that the fee won’t be valid in January 2020. Recently, Vodafone and Airtel, as well as other networks, have been working on ways of extending this deadline.

Some executives say that this change was inevitable. Head of the trade group Cellular Operators Association of the country, Rajan Mathews, said that previous prices were unsustainable for carriers and they needed to cope with that.

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