However the company recently reduced its call rate to India

Mobile: In response to more customers using mobile applications like WeChat and Viber, among others, Bhutan Telecom has increased the price of its mobile internet, last month.

The telecom company increased its data tariff from Nu 0.0003 per kilobyte (KB) to Nu 0.1 per KB, but only for the first 50KB used.

However, this is an increase of almost 200 percent.

Following usage of the first 50KB, the normal rate, that is if the “pay per use” scheme is being used, of Nu 0.0003 per KB will apply again.

The increase applies only to it’s “pay per use” prepaid customers.

The primary reason for the hike is a fall in revenue for the company as customer usage of traditional services like SMS or voice calls has dropped.

“The influx of OTTs (over-the-top) such as WeChat, Viber, WhatsApp, Facebook, Skype, etc., has encouraged our customers to bypass communications through SMS or phone calls,” Bhutan Telecom’s spokesperson, Sonam Choden, said.

Customers using mobile applications are only charged data rates.

“Also we provide net neutrality to OTT providers at the moment by treating all data packets on the internet equally without discriminating data based on content, destination or source at the cost of our network,” she said.

Net neutrality is the principle that internet service providers treat all data on the internet equally and therefore charge one price for all data.

An SMS using the Bhutan Telecom network can cost Nu 0.10, 0.45, or 0.7, based on what time it is sent, while a voice call can cost between Nu 0.1 to 0.7 for one unit, which is 15 seconds, again based on what time it is made, according to information on the company’s website.

In comparison, a message of 500 characters on Viber is usually equivalent to one KB, which would cost only Nu 0.0003 if you’re using the “pay per use scheme”, and a voice call of 15 seconds would be around 60KB, which would cost Nu 0.018, both of which would be significantly cheaper.

“This has greatly impacted overall revenue for the company in the last few years,” Sonam Choden said. “The data tariff has been revised only for prepaid users because of the customer base, we only have three percent of our total subscribers using postpaid services,” Sonam Choden said on why only prepaid customers are bearing the upward revision.

Bhutan Telecom had approximately 486,490 subscribers currently.

On some public criticism that Bhutan Telecom is raising its tariff despite no significant improvements in addressing congestion and data connectivity, Sonam Choden said the criticism is a misconception. “We have only increased a negligible charge of Nu 0.10 per KB for data usage upto 50KB and not for the whole session so far.”

She added that the company is working on improving data connectivity. “We have expanded our network last year, however we saw a huge growth in our data users, so we are investing a lot in the network expansions this year as well.”

Bhutan Telecom’s tariff increase also comes during a global scenario in which data rates are falling. “It is definite that there is a downward trend in data connectivity rates globally. However we are cheaper or competitively priced in our region. If we look at some operators in the region, our data tariff is priced lower than them and even after the revision our rates are still cheaper,” Sonam Choden said.

“However, we would definitely move along with the global trend and revise the rates if possible. We are constantly reviewing our tariffs and just recently we have reduced the tariff for calls to India from Nu 7.5 per minute to Nu 4 per minute.”

The country’s other telecom provider, Tashi InfoComm, does not plan to follow suit in regard to data tariff.

“As of now we don’t have any plan for upward revision of data tariff,” the private company’s commercial general manager, Jigme Thinley said. “The social apps are affecting our revenue also but we are willing to risk to certain extent,” he added.

In 2010, mobile phone users sent almost 70 million (M) SMSes, of which 62.8M were sent by Bhutan Telecom users. The total number of SMSes sent in 2011, increased to 94M, of which 93M were sent by Bhutan Telecom users, as per information available on the website of the information and communications ministry.

By Gyalsten K Dorji