Banglalink looking to invest $1b

Banglalink is keen to invest $1 billion over the next three years to improve its service quality as well as support the government's Digital Bangladesh vision, said the head of its owning company. 

The decision though is hinging on Veon, the parent company of Banglalink, finding a favourable investment and regulatory framework, said Jean-Yves Charlier, the chief executive officer of Veon.

Charlier's comments came at a media briefing held at the capital's Sonargaon hotel yesterday. Banglalink Digital Communications Ltd's CEO Erik Aas and Chief Corporate & Regulatory Officer Taimur Rahman were also present. 

Since its inception in 2005, Banglalink, the country's third largest mobile phone operator by subscriber base, has invested over $2.51 billion. It has also contributed $2.4 billion to the national exchequer.

Banglalink has been operating in Bangladesh for the past twelve years with a prestigious history of transforming lives through technology, Charlier said.

“Given the recent release of spectrum and 4G draft guidelines, we believe the framework is now in place to further develop investment-friendly regulations. This ultimately leads to more digital services and better customer experience.”

Charlier said Veon is keen to position Banglalink as a leading provider of connectivity and internet opportunities, and in so doing, support the launch of 4G across the country and accelerate the digital economy.

In a statement later, Banglalink raised the issue of tax.

The combined financial burden of a disproportionate tax regime for the telecom sector and the significant cost of spectrum constitute an obstacle that must be addressed, it said.

“The tax burden and spectrum fees per MHz are among the highest when compared to international benchmarks. This will impact the investment capacity in 3G and 4G networks and thus the customer experience,” Banglalink said in the statement.

Charlier said they welcome the upcoming auction of 4G and are very much interested in participating in it.

“Banglalink looks forward to working with the regulator on securing the additional spectrum at the earliest opportunity to continue to meet its quality of service obligations and offer better services,” he said.

The operator recently applied for additional spectrum on the 2,100MHz band but the Bangladesh Telecommunication Regulatory Commission rejected the request for direct spectrum assignment.

The allocation of spectrum is a critical issue for Banglalink as it has the least amount of spectrum in the market, Charlier said.

“To serve a significant number of Bangladeshi mobile phone users with minimal amount of spectrum is a big challenge, which has also a negative impact on the whole telecom sector.”

The operator also intends to sell off its tower portfolio in each of its markets as it no longer considers it essential to the provision of new digital services to consumers.

“Banglalink believes that such a move will allow us to unlock precious capital and further invest in its spectrum portfolio, networks and digital initiatives,” Charlier said.

The operator said most countries allow telecom operators to undertake active radio access network sharing, which does not involve the pooling of spectrum.

“Introducing sharing across all technologies (2G, 3G, 4G and beyond) would be a critical regulatory initiative to facilitate more competition in rural areas and critical in the acceleration of 4G coverage equal to the current 2G/3G levels.”

The operator said the government's stated ambition to launch an ambitious 4G strategy marks the perfect opportunity for Bangladesh to further advance its regulatory agenda by implementing a stable, pro-consumer, pro-competition, pro-innovation and pro-investment approach.

As of June, more than 90 percent of Banglalink's 2G sites have been upgraded to 3G, according to Charlier.