Despite rising profits and revenues, Indian telcos lag global ARPU benchmarks, says GSMA, pushing for sustainable monetisation amid heavy 5G and network investments.
GSMA: Indian Telcos Must Raise ARPU for Long-Term Sustainability
Global telecom body GSMA has stressed the need for Indian telecom operators—Reliance Jio, Bharti Airtel, and Vodafone Idea (Vi)—to increase their Average Revenue Per User (ARPU) to ensure long-term financial health and match their growing capital investments.
- According to Vivek Badrinath, Director General of GSMA, the ARPU levels in India are significantly lower than global averages.
- This discrepancy comes at a time when telcos are heavily investing in 5G rollouts, fiber infrastructure, and network modernisation.
Indian ARPU Trails Global Standards Despite Gradual Growth
While Indian telcos have seen steady ARPU growth over the past 5–6 years, they are still far behind when compared to global standards.
- Prepaid ARPU (majority of the Indian market): ₹187
- Postpaid ARPU: ₹182.72 (as per TRAI report, Q1 FY26)
- In contrast, global postpaid ARPU can range anywhere from ₹500 to ₹1,200+, depending on the market.
Even state-run BSNL and MTNL reportedly have the lowest ARPUs in the world, further highlighting the revenue strain within the sector.
Jio, Airtel Reporting Profit Growth — Vi Still Struggling
Despite these challenges, Jio and Airtel are showing strong quarterly performance, with consistent revenue and profit growth:
- Jio’s ARPU for Q2 FY26 stood at ₹211.4, up from ₹195.1 YoY.
- Airtel’s ARPU has also been climbing steadily, often leading the market in revenue per user.
Vodafone Idea, though financially weaker, has also managed to raise its ARPU due to strategic plan restructuring and higher data usage.
However, these numbers are still considered suboptimal by GSMA, given the scale of infrastructure costs and spectrum investments.
Price Sensitivity and Competition Remain Key Challenges
One of the main roadblocks to raising ARPU is India’s price-sensitive telecom market:
- Prepaid users dominate, with postpaid adoption still limited to a small demographic.
- Even though prepaid plans have become more expensive in recent years, further hikes are difficult to push without risking customer churn.
- State-run operators offering ultra-cheap plans further complicate pricing strategies for private players.
These dynamics make it challenging for telcos to monetise network investments at the rate needed for sustainable returns.
Tariff Hike Expectations Remain Uncertain
Despite market speculation around an upcoming tariff hike, major players like Reliance Jio have publicly ruled out any immediate increases.
- This cautious stance suggests telcos are prioritising subscriber retention and market share over short-term revenue boosts.
- However, GSMA believes tariff adjustments will eventually be necessary to maintain network quality and expand 5G coverage sustainably.
