The Bhutanese Leading the way.
Earlier this week, the Druk Holdings and Investment (DHI) Board approved a proposal by the Bhutan Telecom (BT) board on the data rate cut and sent it to the BT board.
The BT board, in turn, has submitted the proposed data cut to the Bhutan InfoComm and Media Authority (BICMA) which needs to give final approval for any rate cuts as per regulations.
It is understood that the BT proposal, instead of being a flat rate cut, is different rates of different data packages with different discounts for those taking different packages.
The average data discount rate is close to the 50% cut that government asked for but not exactly at 50% too.
The two main principles applied by DHI when looking at BT’s proposal is to align with the government’s aim to drive down the cost of data and internet over time in Bhutan, and secondly, at the same time, ensure that BT can provide quality services by ensuring that BT is sustainable.
The proposal to offer different discounts or more data ensures that BT can give discounts and yet earn too. This seems like a delicate balancing act by BT and DHI.
BICMA will have to review the proposal and give the go ahead or not and then BT will submit it to the Gov Tech agency which is talking to BT on behalf of the government.
Background
Earlier, the Bhutan Telecom (BT) Board had proposed to the Druk Holding and Investments (DHI) Board that the 50% data hike ordered by the government be done over two years with a 25% cut in the first year and then another 25% cut in the second year.
However, DHI wanted more studies to be done for sustainability and reliability of services as well as for BT to see what the competition was offering in lease line internet packages. BT took around a month to come up with another proposal for the DHI board which has been approved pending final approval by BICMA.
In 2024 BT made a total of Nu 6.140 billion (bn) in revenue and a profit before tax of Nu 3.345 bn and Nu 2.370 bn in profit after tax.
BT has total assets of Nu 7.273 bn which means that profit for 2024 is generating a 32.58% return on the asset. BT has a total equity of Nu 5.940 bn which makes the return on equity at around 40%.
Of the Nu 6.140 bn in revenue, the biggest chunk of Nu 5.656 bn is from mobile (data, voice and SMS) while a distant second is leased line internet at Nu 381.43 million (mn), landline at Nu 43.32 mn and others at Nu 59.05 mn.
A BT official had said around 75% of its mobile revenue of Nu 5.656 bn comes from data with the rest 25% coming from voice and SMS.
This means around 4.242 bn of BT’s Nu 6.140 bn in total revenue comes from mobile data.
Note: Some changes have been made on the discount information as per the latest updates.
