Airtel Reintroduces Entry-Level Prepaid Plan Amid Subscriber Churn Concerns
Telecom giant restores the ₹299 plan following a sharp decline in new subscriber additions.
1Strategic Reversal on Pricing
Bharti Airtel has officially reinstated its ₹299 entry-level prepaid mobile plan, reversing an August decision to scrap the offering. The company previously removed this option to encourage higher spending, but the move triggered significant customer churn. The plan is now available again on the official company website for all prepaid users.
2Impact of Tariff Hikes
The removal of the ₹299 plan in August effectively forced customers toward a ₹349 alternative, representing a 16.7% increase in monthly costs. This aggressive pricing strategy backfired in a highly price-sensitive Indian market. Competitors like Reliance Jio and Vodafone Idea maintained their lower-tier plans, capturing segments that Airtel temporarily alienated.
3Subscriber Growth Slowdown
Airtel added only 716,000 wireless subscribers during the September quarter, a sharp decline from the 3.3 million additions seen in the previous three months. This deceleration highlights the difficulty of raising tariffs without industry-wide alignment. Total wireless subscribers reached 377.2 million, while the company's broader base including wireline reached 498.7 million.
4Leadership and Market Dynamics
Shashwat Sharma, CEO of Airtel India, attributed the churn to seasonality and the specific prepaid intervention. Despite the subscriber slowdown, Airtel maintains a lead in Average Revenue Per User (ARPU) over rivals. The company reported an ARPU of ₹271, reflecting a 2.7% sequential growth and a 6% increase year-on-year.
5Competitive Landscape and ARPU
Reliance Jio, the current market leader, added 9.1 million subscribers during the same period, bringing its total to 542.4 million. While Airtel’s ARPU growth outpaced Jio’s 1.5% sequential increase, the competitive pressure remains intense. Airtel continues to focus on upselling postpaid services and international roaming to drive long-term revenue growth metrics.
6Industry-Wide Architecture Challenges
Airtel executives have emphasized that the telecom industry requires a broader architectural correction to monetize data consumption effectively. Current pricing models are described as flat, offering unlimited usage at low ARPU levels. The company maintains that sustainable growth requires a industry-wide shift rather than isolated experiments by a single operator.
7Smartphone Market Headwinds
Rising component costs have increased entry-level smartphone prices, leading to a slowdown in new device shipments. Airtel noted that this softness in upgrades impacts the broader telecom ecosystem. However, a robust market for refurbished phones is currently providing a necessary buffer, supporting entry-level connectivity and preventing further subscriber base erosion.
8Financial Performance Overview
Despite the prepaid challenges, Bharti Airtel reported strong consolidated results for the September quarter. Revenue from operations rose 16.7% year-on-year to ₹60,878 crore, while net profit grew 31% to ₹8,887.5 crore. The company’s stock responded positively to the latest developments, ending 2.5% higher on the National Stock Exchange following the announcement.