Airtel recently increased the prices of Pre Paid call rates across India from varying from 20% to 50% depending of different circles. The six regions where Bharti has increased local and long distance call rates include Delhi, Andhra Pradesh, Kerala, Rajasthan, Madhya Pradesh and Gujarat, is expected to spread the hike to other parts of the country as well.
Tata TeleServices, which had unleashed the price war with its per-second billing-based GSM offering about two years ago, recently doubled STD call charges for new subscribers after a year of connection and raised local and national SMS charges by 67% and 25% respectively.
A Bharti Airtel spokesperson confirmed the rise in tariffs on Friday and said the company was left with limited options but to raise tariffs while also blaming increasing inflation.
“Continuously declining margins, high 3G and BWA auction prices, constrained spectrum and rural rollout aspirations leave us with little choice but to make some price corrections,” the spokesperson said while adding that the company will enhance value for customers through continuous investments in network, technology, customer experience and services.
In the past year though the prices have gone down but the operators have tried charging on services that usually are assumed to be free for example now you are charged 50P for every 3Minutes you spend talking to the customer care.
Apart from raising tariffs for calls per minute, the telco also changed its per-second billing plans. An Airtel customer would now have to pay 1.2 paise per second rather than 1 paise per second for a local or STD call to anyone in the same network. Calling a local or STD landline from an Airtel number on per second basis will now cost 1.5 paise a second compared to 1.2 paise a second.
An official added that the company has not changed its base calling rate and charges for calling other network customers from an Airtel number. This means customers not opting for advantage and freedom packs will have to pay the old rate of Re 1 for local and 1.5 for STD calls.
Airtel’s profits have fallen for five quarters in a row, unprecedented for a company that set benchmarks for record growth and profits in the past. The telco reported worse than expected 31% drop in profits in the fourth quarter ended March 2011, over the same period, weighed down by network expansion expenses, interest costs and its loss making Africa businesses.