The government has not backed off on the discriminatory and anti-poor “market competition factor” that was subject to a detailed critique when announced.
Per Mhz spectrum charge has been set on the basis of their market share or ‘market contribution factor’ (MCF) which was previously known as ‘utilisation factor’ in the draft licensing guideline of the BTRC.
According to the policy of the MCF prescribed by the telecom ministry, if an operator has more than 20 percent market share, it will have to pay additionally, while an operator with less than 20 percent share will pay at a reduced rate.
The MCF for Grameenphone now stands at 1.48, Banglalink 1.06, Robi 0.99 and Citycell 0.30.
These numbers have been multiplied by the per megahertz price of Tk 150 crore and the total amount of spectrum used by each operator.
The operators will have to pay 49 percent of their spectrum charges in November when the licences will be renewed, and the rest would be paid in three instalments in May 2012, November 2012 and finally in May 2013.
The key phrase is “if an operator has more than 20 percent market share, it will have to pay additionally, while an operator with less than 20 percent share will pay at a reduced rate.” So the current MCF has been calculated based on mid 2011 data. It creates incentives to shed marginal customers (at least not add new ones). So one could expect the large operators’ market share (defined by number of active SIMs, not revenue) to decrease.
When time comes to pay the 2nd and 3rd instalments in May, they could be expected to ask for a recalculation of what they owe, based on a revised MCF reflecting market shares in 2012, not 2011. Interesting times?