BTRC to run cost model analysis for data prices

The executive committee of the government's Digital Bangladesh Taskforce has asked the telecom regulator to run a separate cost model analysis to formulate the data pricing guideline within a month.

The committee took the decision in a recent meeting presided over by Kamal Abdul Naser Chowdhury, principal secretary to the Prime Minister's Office.

The Digital Bangladesh Taskforce, which consists of senior ministers and different top experts from the sector, is the highest policymaking body on digitisation headed by the prime minister.

Its executive committee assists the taskforce and supervises implementation of the taskforce's decisions.

“We have been working on it for the last few months and we hope to complete it soon,” said Shahjahan Mahmood, chairman of Bangladesh Telecommunication Regulatory Commission, who attended the meeting.

The regulator plans to fix the upper and lower price limit for mobile operators' data packages, added Mahmood, who is also a member of the committee.

For regular voice calls, there is a Tk 2 ceiling and a floor price of Tk 0.25 for each minute, which the regulator fixed in 2008 after a cost modelling analysis supported by International Telecommunication Union. The ITU gave the service for free for Bangladesh's least developed

country status. After a few years, the BTRC set the ceiling for short message services (SMS) at Tk 0.50 for each local SMS and Tk 2 for international SMS. There is no lower price limit in this segment, said an official of the regulator.

However, value added services in SMS and voice could be priced differently, with prior approval from the regulator. 

A senior consultant of the ITU will soon join the BTRC to do the cost modelling analysis, he added.

At present, data service prices are set by the operators, with the regulator having no benchmark to check the rationality of the pricing. “That's why different operators are charging as they wish.”

The government reduced the internet bandwidth price to as low as Tk 625 a megabyte last year, which was Tk 72,000 eight years back.

However, there are allegations that data prices did not fall in line with the deduction in bandwidth prices.

“We understand that bandwidth is one of the components of the total cost, but it is a pricey one and there should be some impact at the end user level when we reduce it. But the telecom companies seem

to disagree. So we decided to do a cost modelling for that,” said Mahmood.

In the meantime, the regulator also organised its first public hearing in November last year on mobile operators' service quality, where users also raised the issue of both data and voice costs.

The regulator also plans to reset the ceiling and floor price for voice services. Since the BTRC has a cost modelling method for the voice segment, they can change some of the benchmarks and revise the charges from time to time as per demand, said Mahmood.

The meeting also discussed reducing or withdrawing the VAT from internet use, which the regulator will finalise after a meeting with the National Board of Revenue, said a committee member.

Currently, there are 6.67 crore internet users in the country, and of the number, 94 percent are using internet through their mobile phones, according to the BTRC.