Mobile phone operators have urged the telecom regulator to further cut spectrum renewal prices and allow payments in 20 equal annual instalments instead of 12.
In a letter to Bangladesh Telecommunication Regulatory Commission (BTRC) Chairman Md Emdad Ul Bari on October 25, the Association of Mobile Telecom Operators of Bangladesh (AMTOB) welcomed the commission’s proposal to extend the spectrum renewal tenure to 20 years, calling it a progressive measure aligned with international practice.
Moreover, the regulator proposed payment in 12 instalments, up from the eight instalments proposed earlier.
The proposed tenure was previously 12 years and four months.
AMTOB also sought the withdrawal of the annual spectrum charge and an urgent meeting between the regulator’s top leadership and the heads of mobile operators.
The letter, signed by AMTOB Secretary General Lt Col Mohammad Zulfikar (retd), covers the 900MHz, 1800MHz and 2100MHz bands held by Grameenphone, Robi and Banglalink.
Their existing spectrum licences expire on November 10.
While welcoming the proposed extension, AMTOB expressed surprise at the pricing, saying the fees appeared to have been calculated by mechanically extending the rates proposed for the shorter tenure in the regulator’s October 19 letter.
“Spectrum valuation and spectrum renewal pricing are not typically determined through a simple linear extrapolation,” the association said, citing factors such as discounted cash flow, inflation, technological change and investment risk.
AMTOB said operators had not expected their request for a 20-year renewal to result in a straightforward scaling up of the earlier valuation. Instead, they expected the regulator to apply its “prevailing reference pricing framework” to determine fees for the longer tenure.
The operators cited the GSMA, the global body representing mobile operators, which maintains that longer spectrum validity and certainty over renewal encourage investment. They also referred to the UK regulator Ofcom, which they said had recently reduced spectrum fees based on forward-looking valuations.
AMTOB questioned the transparency of the valuation process, saying public reports indicated that a consultant’s study had produced a range of values using economic, engineering and international benchmarking methods. However, the industry had not been given access to the study’s assumptions or findings.
Available information suggested that the final prices reflected neither the lower end of the valuation range nor its average, the association said.
AMTOB called for further cuts to the base prices proposed on October 19, a 20-year renewal period with fees paid in 20 equal annual instalments without any upward revision for the longer tenure, and withdrawal of the annual spectrum charge.
“Spectrum pricing should be viewed not merely as a revenue consideration but also as a strategic enabler,” the letter said, warning that excessive costs could constrain investment, delay network expansion and undermine service quality and affordability.
On October 15, the BTRC sent the Posts and Telecommunications Division a proposal to cut spectrum prices by 10 to 30 percent across the three bands, covering a total of 79.2MHz.
Under that proposal, spectrum renewal would cost around Tk 13,100.5 crore, or $1.07 billion, compared with Tk 16,845.2 crore, or $1.37 billion, at existing rates.
The proposed cuts would reduce potential government revenue by Tk 3,744.7 crore, equivalent to about $304 million.
The proposed rates covered a period ending March 10, 2039, or approximately 12 years and four months. Taxes, VAT and other fees would be charged separately.
The prices were based on a consultant’s study that used four valuation methods.
BTRC Chairman Md Emdad Ul Bari has defended the proposed rates, saying they were based on the study and that the regulator aimed to sell at least 80 percent of the spectrum available for renewal.
With the existing licences due to expire on November 10, AMTOB said a direct meeting between the regulator and industry representatives could “quickly resolve any misunderstandings” and help settle the outstanding issues within the limited time available.
