NEW DELHI: The Telecom Regulatory Authority of India’s (TRAI) latest amendment rules could drive an increase in churn among entry-level subscribers to voice-and-SMS-only plans, or compel the industry to undertake broad-based price hikes, according to analysts.
As per scenarios modelled by analysts at Morgan Stanley, the migration of entry-level subscribers to voice and SMS only plans may lead to slight average revenue per user (ARPU) and revenue dilution.
“Even if we assume 25-30% of this cohort of subscribers migrates to lower-priced plans (assuming 15-20% lower), it would still mean less than 1% revenue dilution for the wireless business on our estimates,” the brokerage said in a research note, reviewed by ETTelecom.
In a second scenario, telecom carriers can eventually take broad-based tariff hikes, including on entry-level plans, with some data benefits, ensuring that the floor pricing of entry-level plans remains unchanged but without data benefits, it added. “In this scenario revenue dilution from any possible migration would get even further mitigated.”
On Tuesday, the telecom regulator released the “Draft Telecom Consumer Protections (Thirteenth Amendment) Regulation 2026”, despite stiff opposition from telcos.
The amended rules will be effective from October 21, 2026, and will require operators to offer voice-and-SMS-only special tariff vouchers (STVs) across validity periods where bundled voice, SMS and data STVs are currently available, with proportionately lower pricing; to offer a voice-and-SMS-only plan which can be renewed on the same date every month; and to have at least one voice-and-SMS-only option with a longer validity than the abovementioned options.
However, the multinational brokerage estimates limited implications for data users, such as a ₹349 plan which have a daily data allowance limit of 1.5GB. “We see potential implications for entry-level plans of ₹199, which have some data benefit bundled into it (e.g., ~₹199 plan with 28-day validity, unlimited calling, 100SMS/day and 2GB cumulative data for the period),” it added.
Telco opposition
All three private telcos – Reliance Jio, Bharti Airtel, and Vodafone Idea (Vi) – had strongly opposed the decision to introduce such special tariff vouchers (STVs) during the sector watchdog’s consultation process on the matter. They had argued that the move would be counterproductive, and face technical issues in implementation.
Jio had argued that standalone (SA) voice plans were technically incompatible with the modern 4G and fifth-generation (5G) mobile networks, adding that affordable and short-validity voice plans could lower the cost barrier for scammers, increasing unsolicited commercial communications (UCC) and fraud.
The telecom market leader with more than 500 million subscribers had said that 80% of its entry-level users actively consume data, stressing that existing voice-only plans have seen a limited uptake.
Vi had cautioned that removing data from plans may lead to unexpected charges for users, as data consumption for software updates and other background online activities may trigger pay-as-you-go charges and lead to bill shocks.
Airtel had said that voice-only packs could create a structurally data-excluded segment at a time when India’s digital public infrastructure is increasingly mobile-first.
