The Modi government's coffers may have become richer from the aggressive bidding for spectrum auctioned in March, but it has already had its domino effect on subscribers, as predicted by analysts.
Idea Cellular has raised tariffs for mobile data plans by as much as 100 percent for pre-paid users in the NCR region.
India's third largest telecom carrier has doubled the tariff for few 2G data plans, while increasing charges for 3G by nearly 33 percent. The revised tariffs are effective from 3 June.
The company has also cut down the validity period for some data plans.
It is also expected to hike data tariffs in other circles in the coming days, Livemint said, quoting industry sources.
Idea is the first telecom operator to announce tariff hike after the fierce bidding by telecom companies in March during the spectrum auction that saw the Centre receiving bids for ₹1.10 lakh crore.
Idea had successfully renewed its spectrum licences in the nine telecom circles where it was operating. The company also emerged as the top bidder committing about ₹30,300 crore.
After the auction, the carriers were required to pay about 33 percent of the final bidding amount to the government within 10 days. The companies have the option to pay the remaining amount in 10 annual instalments beginning from 2017.
"The auctions will increase the debt burden of the industry by 70-80% of the spectrum price paid," Hemant Joshi of Delloitte Haskins and Sells, had told The Economic Times in March.
Some analysts had estimated a minimum increase of 10 percent in tariffs, while others expected them to go up by 15 percent.
Experts believe that with the increase in spectrum costs, companies may seriously consider passing on the cost to consumers, despite the intense competition.
