New Delhi: The telecom companies in India have witnessed a significantly smaller rise in Average Revenue Per User (Arpu) at 7.5 percent in FY24, against nearly 20 percent in FY23, media reports said, citing the latest government data.
The Telecom Regulatory Authority of India (Trai) on Wednesday released its yearly telecom sector performance indicators report.
The average revenue per user (ARPU) for wireless services increased to Rs 149 per month in FY24, compared to Rs 138.7 in FY23. The previous year saw a 19.9 percent jump from Rs 115.17, Business Standard reported, citing the Trai report.
Officials stated that the sluggish growth in ARPU led to the recent industry-wide tariff hikes, which came into effect on July 3.
In FY24, ARPU for both postpaid and prepaid services saw an increase. Prepaid ARPU grew by 8 percent over the year, rising to Rs 146.37 from Rs 135.47 in FY23.
Prepaid services remain a priority for telecom companies, as 92.47 percent of subscribers fell into this category in FY24, compared to 92.06 percent the previous year.
On a quarterly basis, monthly prepaid ARPUs have been steadily increasing for over six quarters, though at a slow rate. In FY24, monthly postpaid ARPUs rose by 4.4 percent to Rs 184.63, up from Rs 176.7 in FY23.
This marks a reversal of the previous years decline when postpaid ARPUs had dropped from Rs 185.15 in FY22. Despite this growth, postpaid ARPUs have yet to return to FY22 levels.
Telecom operators view the postpaid segment as premium and are increasingly prioritizing the conversion of subscribers to postpaid plans.
Average monthly minutes of usage (MOUs) per subscriber increased by 4.7 percent to 963 in FY24, up from 919 and 879 in the preceding two years.
Data released on Wednesday also indicated that the telecom sector experienced an 8.24 percent growth in adjusted gross revenue (AGR), reaching Rs 2.7 trillion in FY24, up from Rs 2.49 trillion in FY23. AGR serves as the basis for calculating levies owed by operators to the Department of Telecom (DoT).
Collections from spectrum usage charges (SUC) witnessed a sharp decline of 32.3 percent, dropping to Rs 3,369 crore from Rs 4,968 crore, as SUC collections decreased each quarter in FY24.
This drop was attributed to the government halting SUC fees on airwaves acquired during the 5G auction in July 2022. Pass-through charges also fell by 4.26 percent to Rs 53,579 crore, down from Rs 55,965 crore.
However, license fee collections grew by 8.45 percent to Rs 21,642 crore, compared to Rs 19,954 crore in the previous year.
Reliance Jio, the market leader, reported the highest AGR, amounting to Rs 97,868 crore, reflecting a 9.62 percent increase.
Bharti Airtel experienced the fastest AGR growth, rising by 12.12 percent to Rs 80,529 crore.
Meanwhile, Vodafone Ideas AGR showed marginal growth of 0.79 percent, reaching Rs 29,605 crore, while state-run BSNL saw a slight decline of 1.92 percent, with AGR of Rs 8,019 crore.
