Reliance Jio, Bharti Airtel, and Vodafone Idea (Vi) are all expected to launch 5G network services commercially later in 2022. There are a lot of people who doubt that they will go for 5G as they can be satisfied with 4G. But the thing is, like what happened with 4G, the telcos might do with 5G too. A few years back, Reliance Jio came and shocked the market with its unusually low 4G tariffs. This was to capture market share and build a brand image aggressively. To capture market share in the 5G era, the telcos might repeat the same. The tariffs might not go as low as they used to be in the initial 4G era of India. But they might not be too expensive either from 4G plans. If the 4G and 5G tariffs are almost similar, where 5G is slightly expensive, then people would prefer 5G. This would also give the telcos a chance to increase their average revenue per user (ARPU). Randeep Sekhon, CTO, Bharti Airtel, had said that looking at the international markets, it doesn’t look like 5G is going to be very expensive compared to 4G. However, factors such as spectrum cost and the other network upgradation costs are something that the telcos will consider before the final pricing of 5G plans. This means that we can’t really say whether the tariffs will be low like 4G right now.
Another Round of 4G Tariff Hikes Coming
Before we talk about 5G tariffs, it is important to remember that another round of 4G prepaid tariff hikes is not far. Both Bharti Airtel and Vodafone Idea (Vi) have already said that they will not shy away from hiking tariffs again in 2022. Going by the previous hikes, we can expect that by November or December this year, another round of 4G tariff hikes will come. The thing is, despite the prepaid tariff hikes, the consumer outlook towards telecom services has been positive only. People are paying more, and Jio and Airtel have been both able to add new active users at the cost of Vodafone Idea. Bharat Sanchar Nigam Limited (BSNL) is the only operator who didn’t go ahead with prepaid tariff hikes. But with the 4G launch, even BSNL might go for prepaid tariff hikes.
