The A-Voi-Id [Airtel, Vodafone and Idea] group led by Vodafone has slashed data prices by 80% and Airtel and Idea have cut data usage rates by 90% in the last week. On the first read this is very appealing but in reality the rate cuts apply to pay-per-use plans, applicable to introductory data users and data plan users, after initial data allowances have been exhausted.
We all know that Heavy data users are likely to subscribe to a data plan, based on their usage patterns. Thus, a very small proportion of data users would actually end up paying on the basis of the higher pay-per-use rate.
2G Data Rates of A-Vo-Id Group still high
For instance, a consumer needs to only pay Rs125 per month for 1GB 2G data usage, which implies a rate of Rs 0.13 / MB . The new pay-per-use 2G data rates are 1-2 paise per 10KB or Rs1-2/MB. Hence, despite the 80-90% cut in these rates, they still remain as high as ~16x the implied 2G data plan rates. They contribute < 5% of the Data Revenues.
The Following Table Shows the 2G Vs 3G rates [Old & New] which justifies that A-Vo-Id Cartel is determined to upgrade Users to 3G by gradually increasing 2G Data rates.
