Vi Hikes Price Of Two Postpaid Plans; Know Why

Vi (Vodafone-Idea) has increased the prices of postpaid plans to reduce debts and improve its financial conditions. The telecom operator has raised tariffs of two entry-level postpaid plans to Rs. 649 and Rs. 799 from Rs. 598 and Rs. 749, respectively. Although it is not a major one, it shows that soon prices of other packs might see a tariff hike.

Both Reliance Jio and Airtel are delaying the tariff hike due to decreasing subscriber rates and decisions on tariff floor pricing. Additionally, the tariff hike is likely to affect the market share of telecom operators. On the other hand, brokerage firm CLSA said that the increasing postpaid tariffs might help Vi to increase revenues by one percent in few circles.

The firm said that the balance sheet of Vi is not that strong unlike Reliance Jio and Airtel. So, there are high chances that tariff hikes might affect subscriber share of the latter. "Vi has hiked postpaid tariff by 7-9 percent in two of its family plans. Both Vi and Bharti's postpaid tariffs are at 25 percent premium to Jio in comparable plans," CLSA note stated.

According to TRAI subscriber data, Vi added 1.7 million new subscribers in January 2021. The data said that this is the first time after 14 months, Vi has managed to get new subscribers on its platform. The telecom operator lost 1.5 million customers in December 2020. However, Vi said that there is an error in the data. The data is under TRAI examination, which process and is expected to be published soon.

"It could be a genuine mistake. We are not disputing that. However, the division officers concerned are examining the error and its reason. If we feel that the reason submitted by Vodafone Idea is not enough, we may call the company for further questioning," TRAI official said.

This indicates that Vi is attracting users after losing more than 55 million customers since October 2019. But, sources close to the development claim that this is due to an error in reporting the data. Sources also said that Airtel will continue to add more subscribers and might increase its revenue too.