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Covid-19: International Roaming Revenue To Fall Sharply

Revenue from international roaming is expected to fall sharply for telecom operators due to global travel restrictions following the Covid-19 virus outbreak.

With both India Inc and personal holiday goers also likely to postpone international travel in the summer due to the pandemic, telcos will be faced with a further drop in revenue from international roaming, which was a key component of high-tariff customers.

“International roaming now contributes about 12% of the revenue per month, but that will fall to 8% because of the shutdowns in the second half of March. It may dip further because of Covid-19,” said Rajan Mathews, the director-general of the Cellular Operators Association of India, which represents private telcos Bharti Airtel, Vodafone Idea and Reliance Jio.

International SIM card provider Matrix Cellular International Services also said business had come to a standstill.

“The recent outbreak of coronavirus (Covid-19) around the world has hit the travel industry …and a business like ours which is travel-dependent has been severely impacted. We used to sell an average of 60,000-70,000 cards every month, today it has become zero,” said Gagan Dugal, Founder – Matrix Cellular.

Bharti Airtel, Vodafone Idea and Reliance Jio did not respond to ET’s queries as of press time Sunday.

Over the last few years, telcos, faced with all-time low local tariffs, have come up with many plans to woo international travellers as they form part of the high average revenue per user (ARPU) bracket of over Rs 700 a month.

Last year, analysts had said that the international roaming segment grew at a compounded annual growth rate of 15% over the previous two years and was expected to expand by another 15% over the next two. Those estimates will, however, change following the Covid-19 outbreak, they said.

The telecom sector, already reeling under revenue pressure from competition and high debt as well as the adjusted gross revenue (AGR) crisis, has seen a drop in new subscriber additions, which is expected to slide further due to reduced footfalls at stores.

India had reported more than 320 cases of Covid-19 infections across the country as of Sunday.


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