Reliance Communications (RCom) on Monday announced tariff hike by 20 percent across India.   It also slashed promotional and concessional offers by as much as 65 percent.

 RCom said that the move is driven by greater RPMs and profitability.
 
This has triggered off speculations that other operators will also go for cut in discounts and free minutes in order to improve margins. Only last week Bharti Airtel said that it expected pricing to become more stable. The company had withdrawn discounts in early this year. 

The company in a statement has said that new tariffs to apply to all existing and new customers with immediate effect.

According to new plans commitment plan 21 tariff has been hiked from 1 paise per second to 1.2 paisa per second while for commitment plan 45 tariff has been  hiked from 1 paise per second to 1.2 paisa per second

As for reduction in promotional and concessional offers, commitment plan 48 now offers 160 Local On-Net Mins, against 500 mins earlier,a reduction of 65 per cent. Commitment Plan 46 now offers 140 Local On-Net Mins, against 200 mins earlier, a reduction of 30 per cent

The company said that its headline tariff increase from 1.2 to 1.5 paisa per second in October last year did not see any traffic elasticity and there has been no fall in customer demand or change in usage patterns, as it successfully migrated our entire base to the headline tariff.

 “With the Indian telecom industry now heading for a phase of consolidation, with smaller operators shutting down or scaling down their operations and easing off hyper-competitive pressures, this will help pricing power move back to serious, long-term and pan-India scale operators and positively impact profitability,” said Gurdeep Singh, Chief Executive Officer, Wireless, Reliance Communications.
  
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