Grameenphone has won a crucial legal battle with regulators BTRC as High Court has rejected claim for an extra Tk 236 crore in spectrum fees levied in 2008.

A two-judge bench also said the BTRC was however right in asking for the spectrum and licence renewal fees without deducting value added tax.

Justices Farid Ahmed and Sheikh Hasan Arif, at the same time, observed that the mobile operator would legally get waiver on such taxes

BDNews24.

But in Bangladesh 20 percent market share is the magic number. And it’s not a rebuttable presumption; nor a screen. You go over 20 percent, you start paying more for the critical input of spectrum. This is the gist of the “Market Competition Factor,” I have described elsewhere as anti-consumer. The MCF for Citycell is 0.3, while it is 1.48 for Grameenphone. That means that Grameenphone pays five times the amount paid by Citycell for one MHz.

The Budget Telecom Network model requires operators to carry as many paid minutes as possible, even if from marginal customers who individually contribute very little revenue. This was the cause of Bangladesh’s spectacular mobile growth, even in the face of growth-retarding measures such as the SIM tax. The result of the illogical MCF is to direct operators away from serving large numbers of low-yield customers to small numbers of high-yield customers. It would not be surprising if those running the smaller operators put in place specific measures to prevent market share from increasing. Is the government actually, intentionally anti-poor? Or it is simply acting out of ignorance?

But that discussion assumes that spectrum charges will be adjusted periodically based on fluid market shares. That is not what the Ministry in its wisdom has recommended. What market share an operator had in June 2011 appears to set the price for spectrum for the next 15 years. So even if Citycell has 44.3 percent and Grameenphone has 2.23 percent of the market in 10 years, Citycell spectrum will still cost 1/5th that of Grameenphone!

This takes the cake for arbitrary and capricious administrative action! Is there an igNobel Prize that can be awarded to the MoPT?

Is it better to have journalists who understand the technical aspects of the industry and the practice of regulation, than not? I think the answer is clearly yes. Does this fall within LIRNEasia’s mission, yes. Then the only issue that remains is that of sponsorship. Will LIRNEasia’s image be compromised by my speaking at an event sponsored by Grameenphone, the largest operator in Bangladesh? I do not deliver a script written by Grameenphone, so I see no problem. I spoke at a similar event in 2007 organized by Sri Lanka Telecom, Sri Lanka’s incumbent operator. Have not noticed any negative outcomes.

Looking at the post I wrote after that event, I see that I had said that we were tempted to organize such events in all the countries we worked in. This could be described as yielding to that temptation!

Rohan made a presentation on South Asia’s  Budget Telecom Network Model, that has been adopted by many regional telcos in providing voice services to the bottom of the pyramid (BOP), and how the same can be applied to broadband services as well. The presentation drew on findings from LIRNEasia’s Teleuse@BOP, telecom regulatory environment (TRE) and mobile benchmark studies. The full presentation can be downloaded here.

Other speakers at the event included Kristen Due Hauge from the GSMA,  M. Aslam Hayat from Grameenphone, and Tandi Wangchuk from Bhutan Telecom.

The mobile industry partially got some relief. The minister reduced mobile set import tax to 12 percent from the proposed 25 percent.

However, the minister did not mention about SIM tax, which means Tk 800 tax on each new mobile connection would remain unchanged.

“The new budget seems to be fairly progressive, but we are disappointed to see that the SIM tax remains unchanged,” said Oddvar Hesjedal, chief executive officer of Grameenphone.

The Indians along the Bangladesh border in Meghalaya and other north-eastern states “are forced to use prepaid cards of GrameenPhone, the largest cell phone service provider of Bangladesh, paying ISD call rates.”

People without mobile phones cross the border and use Bangladeshi phone booths and they pay hefty amounts of international tariff to call own country, the report alleges.

Villagers have complained to the Telegraph correspondent that the Indian government does not provide them basic telecoms facilities on the pretext of security.

India’s state-owned telecoms major, Bharat Sanchar Nigam Limited (BSNL), has now decided to launch cell-phone services in areas bordering Bangladesh soon after receiving the ministry of communications’ written order.

BSNL does not provide mobile phone service in the rebellious north-eastern areas due to Indian home ministry’s objection to deploy the networks within 10 kilometres of border with Bangladesh border, fearing exploitation by the region’s militant groups.

“As long as everybody gets access to some network, what difference would it make whether it is Indian or Bangladeshi?” questioned a senior BSNL official to The Telegraph.

The BSNL’s Meghalaya telecoms district general manager, R Ramesh, said they were hopeful of receiving New Delhi’s nod in “black and white” within a week. “We will start erecting equipment once we receive the green signal,” he said.

BSNL would then commence services in Mahendraganj, Phulbari and Bajengdoba in the Garo Hills. Remaining areas of the state would soon be brought under the new network’s coverage, the Telegraph said.