2024 has been one of the hottest summers in the history of India. But this summer can also lead to telecom companies tariff hike. In this article, we will try to analyse how too much heat this summer will affect telecom operator tariff rates. So without any delay, let us start our discussion.
How can too much heat lead to an increase in telecom tariff rates?
One of the major costs involved in operating the telecom business is the infrastructure maintenance cost. Some studies show that infrastructure maintenance contributes to about 10–20% of a telecom operator’s overall operating expenses. And during peak summers , maintenance costs can surge by 20 to 50%. And who, do you think, is going to pay for those expenses? The company or the consumers? Obviously, the consumers… because the company will likely pass on those increased costs through higher prices or fees.
But wait, not a question arose in your mind , how is the summer increasing the maintenance cost? I can explain that to you.
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Impact of Heat on Telecom Infrastructure
1)Passive Infrastructure: This includes cell towers, owned by tower companies and leased to telecom operators. Extreme summer heat can:
i)Overheat Equipment: Telecom equipment like antennas and transceivers is sensitive to heat. Excessive temperatures can cause them to malfunction or reduce efficiency.
ii)Damaged Cables: Underground fibre optic cables can be impacted by extreme heat, leading to disruptions and repairs.
2)Active Infrastructure: This refers to the telecom operators’ network equipment. Heat can:
i)Strain Cooling Systems: Cell towers and network centres rely on air conditioning to maintain optimal temperatures. During the summer, these systems work harder, leading to higher energy consumption.
So, these were the possible reasons behind ” How can too much heat lead to an increase in telecom tariff rates?”
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Telecom companies tariff hike Expectations.
The telecom companies may have to increase their tariff rates to cover the high cost of infrastructure maintenance during this challenging time. . This increase in tariff rates can ultimately be passed on to consumers, resulting in higher bills for telecom services. According to some sources , the hike can range from 10–15%.. This hike is for sure going to benefit telecom companies like Vodafone Idea, which is currently struggling to stay afloat due to intense competition and high debt.
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