On Vodafone Idea, Airtel & Jio footsteps, BSNL to raise tariff from December


On Vodafone Idea, Airtel & Jio footsteps, BSNL to raise tariff from December

NEW DELHI: State-owned Bharat Sanchar Nigam Limited (BSNL) is currently reviewing its mobile tariff plans and will raise it from December 2019, following the hike announced by private telecom carriers.

“We are presently examining our voice and data tariff and will increase it from December 1, 2019,” a senior BSNL official who does not wish to be named told ETT.


However, the person privy to the matter didn’t elaborate on the quantum of a proposed hike but added that it would be conveyed to the subscribers in the coming weeks.

Early this week, Vodafone Idea and Bharti Airtel said that they would increase their tariff with effect from December this year, following sectoral stress. The move by two telcos was closely followed by arch-rival Reliance Jio which on Tuesday said that it would also raise its tariff in the next few weeks.

In October, the Centre has allowed a revival package for the two financially stressed public sector telecom companies— BSNL and Mahanagar Telephone Nigam Limited (MTNL) — which according to analysts appeared to be cosmetic relief.

The tariff hike, however, would help the ailing state-run telco to bring in additional cash flow at a time when its revenue is in a continuous slide due to the unavailability of the fourth generation or 4G services.

“It will not be really a very bad move from the consumer perspective. Since the Jio’s entry in 2016, tariff and industry revenue were down,” Rajiv Sharma, Head of Institutional Equity Research, SBICAP Securities.

The state-controlled telco though has been offering competitive tariff plans since Jio’s disruptive foray in September 2016 that has tactically led it to stand against adversities and overcome subscriber erosion.

Meanwhile, according to the sector regulator, BSNL has added 7.37 lakh new users in September this year taking its total consumer base to 11.69 crore. On the contrary, Vodafone Idea and Bharti Airtel have together lost nearly 49 lakh subscribers during the same month.

The recent adverse Supreme Court ruling mandating the telecom companies to pay up outstanding to the Department of Telecommunications (DoT) within three months, coupled with the existing cumulative debt of Rs 7.5 lakh crore, has made the incumbents heavily strained.


Source:- economictimes