Indian telecom companies to reduce freebies on pre-paid connections

Indian telecom companies to reduce freebies on pre-paid connections

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Indian telecom companies are now taking steps to improve their profit margins. Telecommunication companies in the country have now started cutting back freebies and have increased the prices of discount vouchers being used by a majority of pre-paid subscribers.

The recent move has been made as companies try to compensate for stagnated revenues. Service providers are also hoping that these steps would help them improve sales and margins. India has about 906 million mobile connections out of which 96 percent account for pre-paid connections.

Many pre-paid subscribers use discount vouchers and these make up for nearly 70 percent of operators’ revenue, but this market has remained stagnant for the last three years. In the past few days it was noticed that the companies like Idea Cellular, Bharti Airtel, Vodafone India and Aircel have made changes in their discount vouchers, which would help to lift profit margins.

The move was earlier aimed at certain circles only, but this has been applied to the entire country over the course of a year. A spokesperson from Airtel said that there was still some room to reduce free-minutes and low-value options in all markets across the country, given the state of the telecom industry. They went on to say that Airtel will continue to provide value to its customers.