42 applicants for international gateway licences; committee recommends new unit manages cable

5 Dec 2007

42 private sector firms submitted bids for setting up three international voice gateway exchanges in Bangladesh by yesterday’s deadline, in an auction launched by the Bangladesh Telecommunications Regulatory Commission (BTRC) in October. Officials from the regulator said that 65 firms bought application forms for the right to set up gateway exchanges to break the monopoly of state-run Bangladesh Telegraph and Telephone Board (BTTB) in the international call sector. Under rules laid down by the BTRC, three successful bidders will launch services within four months of licensing. Each licensee will initially provide access to international networks through Bangladesh’s only submarine fibre link, the SEA-ME-WE 4 cable. Back-up connectivity will be provided via satellite earth station until an alternative submarine cable is available. The auction was launched under the regulator’s International Long Distance Telecommunication Services Policy 2007, which was approved by the government in August. The policy is being implemented in three stages: firstly, the international gateway licensing; a second stage interconnecting local exchanges to the international gateways and access network service (ANS) providers; and a final stage enabling private ANS providers to offer direct services, such as VoIP telephony, to end-users.

In related news, a government committee has recommended the formation of a separate company by September 2008 to look after the SEA-ME-WE 4 undersea cable link, currently owned and managed by BTTB. The five-member committee, headed by Ziaur Rashid Safdar, general manager, security and surveillance of BTTB, submitted its report on a draft ordinance to turn the incumbent telco into a government-owned public limited company to the Ministry of Posts and Telecommunications last week. ‘We have recommended formation of a separate company to manage the undersea cable as part of the restructuring process of BTTB, which we hope will be incorporated in the revised draft ordinance that will be sent to the advisory council for approval,’ said a member of the committee. The committee also recommended separation of cellular operator Teletalk’s assets from BTTB, which will be renamed as Bangladesh Telecom Company Ltd after it is transformed into a PLC.

A senior Ministry of Posts and Telecommunications official said the department had not yet made a firm decision on whether to incorporate the recommendation to form a separate company for submarine cable management in the revised draft ordinance. ‘We are working on it,’ he said. The 10Gbps capacity link, with a landing station at Cox’s Bazaar, was launched commercially in May 2006 at a cost of USD35 million, but according to BTTB officials the cable has not yielded anticipated levels of revenue due to weak management and marketing. According to company sources quoted by local press, 73 communications firms have bought capacity of 462Mbps to date, but the telco has earned total revenue of only around USD3 million from connection and rental fees. Another problem has been service disruption caused by the fibre link being cut or otherwise damaged, with BTTB reporting a total of 22 such incidents in eighteen months.

On the plus side for BTTB, the ongoing crackdown on illegal VoIP operations has resulted in a record jump in overseas telephone calls made over its network. Last month the telco said it was handling more than twelve million minutes of overseas calls per day, up from around four million minutes per day last year. Most of the increase is due to incoming calls, however. Overseas voice traffic through the legal BTTB channel started to mark a significant upward trend from January this year and rose to a peak of around 14 million minutes a day during the recent Eid vacation.

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