Bharti Airtel MD Gopal Vittal on Wednesday said the current pricing structure in telecom industry will not work in long run and needs a change. In the January-March earnings call with analysts, Vittal said the customers should pay more for higher usage of data and it should not be an approach of one-size fits all.Giving an example of markets like Indonesia and Thailand, Vittal said, “Our pricing structure is broken and data allowance should be ideally linked to price.”
“In a consumer industry you would typically have people who are able to pay more get more (services),” Vittal added. In February, Vodafone Idea CEO Akshaya Moondra also said that the tariffs should be increased in the unlimited plan segment where over a period of time the trend suggests a customer pays more for using more.With regard to 5G, Vittal said the company is seeing user engagement on the platform while expressing concern over data pricing, which is amongst the lowest in the world.
Airtel 5G service is currently available in over 3,000 cities and the company is targeting to extend it to all major towns by end of the year. In the January-March quarter, Bharti Airtel posted an 89% jump in its net profit to Rs 3,006 crore on the back of lower operating cost and tax-related adjustments. Consolidated revenues rose 1% quarter-on quarter (q-o-q) to `36,009 crore, led by additions in the 4G subscriber base.
The average revenue per user (Arpu), however, was flat sequentially at Rs 193, due to absence of tariff hikes as well as fall in average data consumption. At 20.76 GB, Bharti continues to lag behind Jio’s 23.1 GB on data usage per customer in the country. Bharti’s data usage per customer was down 0.1% sequentially.