The tale of telecom | The Daily Star
12:00 AM, January 22, 2010 / LAST MODIFIED: 12:00 AM, January 22, 2010

The tale of telecom

Affordable to all, mobile phones are now a common phenomenon in the country Photo: SK Enamul Haque

In the early 90s, Mahmudul Haque paid Tk 20,000 in bribes for a telephone connection. But unfortunately, Haque did not get a connection and neither did he get his money back. The money was pocketed by a BTTB middleman.
Presently, all of Haque's family members, including his 17-year-old grandson, own mobile phones, thanks to the handy GSM technology.
There was a time when the telecoms service provider was dictator in the single player market. Customers were like slaves and service provider became their masters.
"But after GSM operators debuted in the mid 90's, competition changed the situation. Subscribers became the masters and the service providers became slaves,” said Abu Saeed Khan, senior research fellow of LIRNEasia, a regional telecom think-tank.
Looking back at the history of telecoms in the country, Bangladesh Telephone and Telegraph Board (BTTB) was the lone telecoms operator until 1993. Bangladesh Telecom Limited (BTL) then awarded the license to operate cellular services.
However, the first mobile service in Bangladesh remained limited to only a few rich customers, due to its hefty price.
Haque, who franticly sought a BTTB (now BTCL -- Bangladesh Telecommunications Company Limited) telephone connection to talk with his son living abroad, could not even then get a connection then because of exorbitant prices.
"It was difficult for me to buy a mobile phone that cost more than one lakh taka. The tariff was also beyond my capacity,” said Haque.
Monopolisation in the telecoms sector shattered with the debut of three GSM operators --Sheba Telecom, Grameenphone and Aktel -- in the mid 90's.
Competition among the GSM players brought phenomenal power into the hands of the customers.
Customers could switch from one operator to the next with the GSM (global system for mobile communications) technology without the need for changing handsets, which was not the case for CDMA, said Khan.
Although mobile tariff dropped from around Tk 25 a minute to around Tk 11 from the shift from CDMA operator to GSM, the technology remained beyond the grasp of the masses until 2005 due to the still high prices then.
Bangladesh needed almost decade to add 10 million customers into the mobile networks. Interesting enough, the next 40 million customers were added in a mere four years -- 2005-09.
The price war among the operators intensified after Egypt based mobile operator Orascom acquired Sheba Telecom in 2005. Connection prices were further lowered to Tk 10 and the per minute tariff dropped to Tk 0.25 under the aggressive marketing strategy by Banglalink, the subsidiary of Orascom.
The mobile phone customer base reached 52.43 million by the end of 2009.
In the latest move in the telecoms industry, Bharti Airtel acquired a 70 percent stake of Bangladesh's fourth largest mobile operator Warid Telecom. From a customers' point of view, arrival of the new operator will instigate a fresh new round in the price war among operators.
Haque, a retired government official from Magbazar, wants more people connected with the handy communication technology. He feels many more of his rural relatives could stay in touch if the call tariffs were lower.

Telecom History

Landmarks in the history of telecom industry in Bangladesh
Bangladesh Telegraph and Telephone (T&T) department was created in 1971
Sheba Telecom (Pvt) Ltd was granted a license in 1989 to operate cellular services in the rural areas of 199 upazilas
Pacific Bangladesh Telephone Ltd (1989) and Bangladesh Telecom (1989) received the mobile phone license
Grameenphone (1996) and Telephone Malaysia International Bangladesh (1996) were formed
Bangladesh Telecommunication Regulatory Commission was formed in 2001
Egypt based Orascom acquired Sheba Telecom in 2005
Japanese NTT DoCoMO bought 30 percent stake in Aktel in 2008.
Market largest telecom operator Grameenphone listed in capital market in late 2009
Bharti Airtel acquired 70 percent stake in Warid Telecom in January 2010.

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