Regulator working on internet price guideline
The telecom regulator is formulating a pricing guideline for internet services as data is not becoming cheaper at the user level despite significant cuts in bandwidth prices.
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.
Two consultants of the International Telecommunication Union are in Dhaka and working with the telecom regulator and other stakeholders to set the cost modelling benchmark. The ITU is charging Tk 26 lakh for the service.
The Bangladesh Telecommunication Regulatory Commission already has cost modelling benchmarks for voice and short message services.
"The consultants are working to bring the best practices for cost modelling," said Md Emdad ul Bari, director general for system and services at BTRC.
In November last year, the BTRC organised a public hearing where mobile users complained about the higher price of internet.
This prompted the telecom watchdog to run the data cost modelling for mobile operators.
But it changed its mind yesterday and decided to engage the internet service providers, who have only 5 percent of the internet customers but use up 60 percent of the bandwidth in the country.
Currently, there are 6.67 crore internet users in the country, 95 percent of which access internet from their handheld devices.
The consultants have already sat with the mobile operators and are due to sit with the internet service providers and nationwide telecommunication transmission network service providers today.
The data cost model, which would contain the floor and ceiling prices, will not be ready before September, said a senior BTRC official.
"The model will help us bring proper regulation in this field," he said. The mobile phone operators have welcomed the move: they said it will give a clear picture to everybody.
"We are welcoming it. However, we expect the telecom regulator to share the outcome of the study with us in a transparent way through a consultation process," said Mahmud Hossain, chief corporate affairs officer of market leader Grameenphone.
At present, the data service prices are set by the operators, with the regulator having no benchmark to check the rationality of the pricing.
The data prices in the country are already the second lowest in the world after Vietnam, according to the Association of Mobile Telecom Operators of Bangladesh.
The principle of the cost modelling should be clear first, said Abu Saeed Khan, senior policy fellow at LIRNEasia, an ICT think-tank based in Colombo. "Is this consultation protecting private duopoly of the transmission business in the country? This should be the main issue of BTRC's consultation." And the ITU consultants should focus on the issue, said Khan, also a former secretary general of Amtob.
"They have to prepare the recommendation considering this issue very seriously," he added.
Senior officials of the regulator said they are planning to fix the upper and lower price limit for mobile operators' data packages.
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 the ITU.
The ITU gave the service for free for Bangladesh's least developed country status.
After a few years, the BTRC set the ceiling 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.
Earlier, BTRC Chairman Shahjahan Mahmood said they understand that bandwidth is one of the components of the total cost.
"But it is a costly one and there should be some impact at the end user level when we reduce it. But the telecom companies seem to disagree."
As of April, the country's total data consumption stood at about 425 Gigabits per second, said MA Hakim, president of the Internet Service Providers Association of Bangladesh.