Cheap smartphones key to 3G expansion
Cheaper smartphones and favourable pricing for 3G spectrum are keys to the growth of internet in the country, a top telecom official said.
“The more penetration we have, the more spectrum we will need,” Ziad Shatara, chief executive officer of Banglalink, the country's second largest mobile phone operator, told The Daily Star in an interview recently.
More reasonable pricing of spectrum would allow mobile operators to invest more in spectrum and network, he said, while suggesting the government remove barriers so that smartphone prices can be lowered.
“Our aim is to bring down smartphone prices below $50 -- we believe this will help grow penetration.”
Banglalink might initially subsidise the price of smartphones to get as many customers to use 3G services, Shatara said, adding that the operator is working with handset manufacturers to make it happen.
It is hoping to have a similar effect to the industry as in 2005, when it introduced a low-cost handset. It took everyone off-guard and put mobile phones in the hands of people who previously saw it as something unaffordable.
Shatara said the internet is not a luxury but a necessity even if it can be used for entertainment.
“So delivering internet to the public can even resolve road traffic -- if people can resolve their day-to-day problems online, they won't need to travel. If this mindset is applied, you will have to facilitate everything that will lead to internet reaching everyone.”
A subsidiary of the Netherlands-based Vimpelcom, Banglalink has about 25 percent shares in a market of 116 million mobile subscribers, according to data from Bangladesh Telecommunication Regulatory Commission.
The operator recently crossed the 3 crore-mark in terms of subscribers.
“We have done a good job in terms of acquiring market share, but we want to continue grow. We look forward to grow and acquire more happy subscribers,” he said.
He said Banglalink has taken 3G very seriously.
“We see this as an opportunity for us to grow the data market because there is a big demand, as the data connectivity was under-served in Bangladesh prior to the arrival of 3G."
Just to demonstrate how serious the company is, Banglalink launched 3G services in October last year, less than a month after getting the licence.
It completed the coverage of all of the 64 districts in June this year, nine months after it got the licence.
“Now, we have one of the highest numbers of 3G sites in the country. As a result, our coverage is one of the best and we deliver the fastest internet in the market,” said the Jordanian.
As of August, its 3G user base stood at 811,881, up 21 percent from the previous month. Data usage grew 52 percent from the previous month in August, according to data from Banglalink.
The mobile operator is upgrading its network, which is due to be completed in October. Huawei, the world's largest telecommunications equipment maker, is helping the mobile operator replace the old system with new ones.
“In simple terms, it will allow us more capacity and better voice quality. It also means less maintenance and power consumption, more green and environment-friendly technology and operations,” he said.
Shatara joined Banglalink in January 2013 as its CEO.
He has accumulated regional and international experience exceeding over two decades of proficiency in building, running and expanding operations in telecommunications, cellular business, and fixed and broadband networks integration technology.
Under his leadership, Banglalink went for massive investment in having 2G licence renewed, 3G licence acquired and network expanded.
The company spent about $300 million annually in the last three years, with total investment in the country since 2005 being around $2 billion.
“The heavy investment will continue next year because we will continue to invest on 3G and 2G coverage expansion, both which are very critical for us,” said Shatara.
He said the country's telecom industry is going through a transformation as it shifted to being a data connectivity provider from a voice and SMS operator.
Banglalink has also chosen its own path as it plans to become a mobile data company, rather than only a voice company.
“Voice would happen as a by-product. In the end, we are aiming to drive our company to a mobile internet company. For this we invested and took it very seriously. We want to see ourselves as the leader in the segment.”
Shatara thanked the government for taking internet education very seriously under its Digital Bangladesh Vision by 2020.
He also said in general he is a fan of a more liberal regulatory system that allows the market to operate freely.
The company employs 3,000 people and recruits people every day. But what is more important to Shatara is that the company is creating job opportunities indirectly for millions of others across the country.
Banglalink has partnered with banks in providing mobile financial services under the model developed by Bangladesh Bank. It has 4.2 million customers who are using mobile payment services offered by various banks.
“We believe we can complement the banks because they have the money experience and we have the network and the physical channel to reach people. If we can partner together, we can create a very successful experience for the people.”
He said the potential for the mobile payment service is huge because the number of unbanked people in the country is extremely low.
“We have 116 million subscribers -- these subscribers could be customers of banks. Then money circulation will be much easier and the economy will benefit as a result.”
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