Idea Cellular Management does believe that the tariffs now seem to be bottoming out and realizations should inch up going forward. In fact, Idea has already started tweaking plans (mainly discount vouchers) in various circles depending on local dynamics. Management’s view remains that increase in ARPMs will be gradual, rather than a one-time steep hike.
Idea 3G in India Management remains positive on the market’s data growth potential, driven by affordability, adoption of 3G (higher speeds) and hence increasing usage. However, growing off a small base (currently ~ 5.7% of sales) data is unlikely to be a key contributor to total revenue over the next 3 years. Idea has 21.75m data subscribers (~19% of total Idea subs), of which 3G stand at 4.1m.
Idea thinks, Litigation related to excess spectrum charges and refarming of 900 MHz spectrum has the potential to delay the government’s plan on recovery of regulatory charge.