BTRC moves to adjust mobile call rates

Bangladesh Telecommunication Regulatory Commission (BTRC) has made a surprise move to adjust mobile call rates which, if implemented, will increase consumers' call expenditure by about 10 percent.

At a Commission meeting on July 24, the regulator decided to propose a 40 percent hike in the minimum voice call rate within the same operator (on-net) and a 25 percent cut in the minimum call rate for other network (off-net), according to meeting documents. 

The BTRC, which sent the proposal to the posts and telecommunications ministry last week, says the move will reduce the gap between on-net and off-net call charges like in other developed countries.

Private mobile phone operators welcomed the move though they did not place any proposal before the telecom regulator or the government in this regard.

The adjustment will fetch the three private operators -- Grameenphone, Robi and Banglalink -- Tk 121 crore in additional monthly revenue, but state-owned Teletalk will lose Tk 4 crore a month, business insiders said.

Last month, the telecom regulator sent a separate proposal to the posts and telecommunications division for increasing the tariff of broadband internet, which is yet to be approved. In the current budget, the government also imposed an additional 5 percent import tariff on mobile sets. 

In the July 24 meeting, the BTRC decided to propose that the ministry increase the minimum on-net call rate to Tk 0.35 per minute from existing Tk 0.25, and cut the off-net rate down to Tk 0.45 per minute from Tk 0.60.

“We sent the proposal to the government last week, but there are other realities. So we may discuss the issue again and revise it. We may bring some changes,” BTRC Chairman Shajahan Mahmood told The Daily Star last night.

“This is not an unaffordable increase,” said TIM Nurul Kabir, secretary general of the Association of Mobile Telecom Operators of Bangladesh.

“We are offering one of the lowest tariffs in the world and revenue per users in every month is also one of the lowest in this market, though per-capita income has increased significantly,” said Kabir.

The move will also increase government's revenue earning, as the government gets 45 to 50 percent of mobile operators' revenue. “It will be a win-win situation,” he said.

Telephone operators' expenditure has increased in the last few years but their earning from voice call have not. The earning from voice call has rather remained static at a minimum level amid extreme competitions in the market, the official said.

The BTRC also proposed slashing the maximum voice call rate to Tk 1.5/minute from Tk 2 now, said another official.

However, insiders say the change in ceiling rate won't have much of an impact because this level of call rate is now very rare.

In 2010, after a cost modeling study, the telecom regulator with assistance from the International Telecommunication Union (ITU) fixed the floor and ceiling rate of the present voice call rate.

Before that there was no official study from the regulator and call rates used to be set arbitrarily. Back then, the call rate ranged between Tk 7 and Tk 10 per minute for long. 

This time the telecommunication regulator has conducted a study of its own, which shows top operators will gain from this changes while the smallest operator, Teletalk, will lose.

Currently the country's total on-net call volume is around 1,865 crore minutes a month which has a value of Tk 446.24 crore, according to the study, which was done based on information of April-June this year.

The report says that if the government increases the minimum on-net call rate to Tk 0.35 and if the operators can maintain the same call volume, then the value will increase by Tk 186 crore to Tk 653 crore a month.

In the off-net segment, average call volume was 463.38 crore minutes worth Tk 278 crore a month. If the government slashes the rate, earnings will come down to Tk 209 crore.

The rate hike will increase Grameenphone's income from on-net calls by Tk Tk 112 crore a month. However, it will lose Tk 19 crore from the off-net segment. At present, the company's monthly earnings from these two segments stand at Tk 280 crore and Tk 754 crore respectively. 

The newly merged operator Robi's on-net income will increase by Tk 45 crore a month, which is now Tk 104 crore. In the off-net segment, the company will lose Tk 26 crore from its current monthly revenue of Tk 112 crore.

Banglalink's on-net earnings will increase by Tk 29 crore, while its off-net section will lose Tk 20 crore a month, according to BTRC's study. Its current on-net call earning is Tk 71 crore and that from off-net Tk 78 crore.

State-run Teletalk now earns Tk 2.32 crore in on-net revenue a month and Tk 20 crore from off-net segment. If the BTRC proposals are approved, it will earn Tk 1 crore more per month from the on-net calls and lose Tk 5 crore from off-net calls.

At present, there are 13.5 crore registered mobile subscribers.