ISPs Thrive as Telecom Companies’ Revenues Decline - The Changing Trends

These days, everyone in Nepal seems to be using the internet for almost everything: calling, messaging, studying, or even just scrolling through social media. Because of this, internet companies (ISPs) are making more money, while telephone companies are losing out.

A few years ago, telephone companies were doing great. In 2075/76, they earned NPR 92.12 billion. But now, in 2080/81, their income has dropped to NPR 71.90 billion, a decrease of nearly 22 billion in five years. In fact, telecom companies have seen a steady decline over the years: in 2076/77, their revenue was NPR 81.20 billion; in 2077/78, it dropped to NPR 75.71 billion; in 2078/79, it rose slightly to NPR 77.05 billion, but in 2079/80, it fell again to NPR 72.84 billion. On the other hand, internet companies have been growing fast. They used to earn NPR 10.84 billion five years ago, but now they’re making NPR 21.51 billion, a nearly double increase in their revenue.

Why Are Phone Companies Struggling?

The main reason is pretty simple. People don’t make regular phone calls or send SMS as much anymore. Instead, they use apps like WhatsApp, Viber, and Messenger to call and message over the internet. These apps are cheap and easy to use, so who would want to pay extra for SMS or phone calls? Even though big companies like Nepal Telecom and Ncell provide internet services, they’re still not earning as much as they used to. Nepal Telecom even started offering fiber internet like other ISPs, but it hasn’t helped much. In fact, despite offering fiber, their revenue from telecom services continues to decline.

What’s Happening With Internet Companies?

While phone companies are losing money, internet companies are making big gains. More people are using the internet every year. Five years ago, there were about 16 million mobile internet users in Nepal. Now, there are over 31 million. Fixed internet users have also jumped from 4.2 million to 12.3 million. Internet companies are benefiting from the growing demand, which includes a significant shift toward streaming, remote work, online learning, and gaming.

What Experts Think

According to technology expert Manohar Bhattarai, this is happening worldwide. “Everyone uses the internet for almost everything now. That’s why phone companies aren’t earning as much. If they want to survive, they need to upgrade their services and offer something new,” he said.

What Does the Future Look Like? 

Everyone is outgrowing the telephone companies. If these companies don't adapt to what people need, they might face bigger problems in the future. They need to come up with new ideas, which will attract new users. Companies like Ncell or Nepal Telecom should improve their internet service or come up with special packages. In the era where the internet has become a part of our lives, telephone companies should come up with excellent strategies to order to beat the evergrowing internet companies. 

Revenue Comparisons and Sector Trends

Despite the success of ISPs, the overall telecommunications sector (including both telecom and ISP companies) has seen a slight decline. In 2075/76, the total revenue of both telecom and internet sectors combined was NPR 102.97 billion. By 2079/80, this figure dropped to NPR 94.24 billion and further decreased to NPR 93.42 billion in 2080/81. The drop in telecom revenue, combined with the growth of internet providers, shows the changing dynamics in the sector.

For context, Ncell earned NPR 37.44 billion in 2080/81, while Nepal Telecom earned NPR 34.46 billion in the same period. Despite these figures, they still haven’t managed to recover or grow significantly compared to their internet-focused counterparts.

Conclusion

The data clearly shows the growing importance of Internet services and the decline of traditional telecom offerings. In a country where internet usage is growing so fast, it’s clear that internet companies are winning the race. But phone companies still have a chance to turn things around, if they figure out how to keep up with the times.

Also read: Nepal Introduces Digital Driver's License