Consumers have been using their existing numbers from Vodafone, Airtel or Ideas as a primary number apart from a Reliance Jio sim for data and free calls. All the major telecom operators have been incurring losses since Jio arrived.
In spite of slashing prices, the other telcos are yet to keep up with the competition.
As most of the users only use these numbers to receive calls, the companies have come up with a new plan to improve the average revenue per user (ARPU). The companies have introduced minimum prepaid recharge packs valid for a limited period only.
The latest move by Vodafone, Airtel and Idea is aimed at increasing the average revenue per user. The companies now want to focus on active customers who generate revenue.
Airtel and Vodafone are going to be the first companies to introduce minimum recharge plans for customers to keep their connections active.
Minimum Recharge Packs: Focus On Mid & Upper Tier Customers
Unlike another top up plans which came with lifelong validity, the minimum recharge packs will come with limited validity.
The companies are shifting their focus towards the middle and upper-tier customers, who don’t switch operators based on prices and does not compromise on quality.
The minimum recharge packs will have a limited validity. They are meant to improve the ARPU where these operators are losing out money on customers who do not generate any active revenue.
The minimum recharge plans are priced at under Rs 100 are Rs 35, Rs 65 and Rs 95 offering talk time and data with a 28 day validity.
Outgoing Calls Will Be Blocked After 30 Days, Incoming Calls After 45
If you don’t recharge your Vodafone or Airtel number with any of the minimum recharge plans, your outgoing calls will be blocked after 30 days. Not only outgoing, but the incoming calls will be blocked as well, in 45 days.
While users continue not to use any of these numbers, telecom operators are losing a major chunk of the revenue to keep these numbers operational.
As most of the customers use a Reliance Jio SIM with any of their existing Airtel and Vodafone number just to receive calls and texts, the new move seems inevitable.
While these telcos are not able to generate any revenue from these users, they plan to let this section of users go. The companies will only now focus on mid-tier and upper-tier users who don’t compromise on network over prices.
New Move To Improve ARPU
The new minimum recharge plans have been specifically designed to improve the average revenue per user (ARPU) for these operators. The limited validity plans will ensure a flow of income for these operators.
Airtel and Vodafone no more plan to retain customers based on freebies and low-priced plans.
To sum up, companies will block customers who do not generate any active revenue for them. The current minimum plan is priced at Rs 35 offering talktime and mobile data for 28 days.
While Reliance Jio is in no mood to give its aggressive pricing a break, it will be interesting to see how things turn out for Airtel and Vodafone in the meantime.