Spectrum Stalemate: Operators Raise Alarm Over 700 MHz Auction Terms
The Bangladesh Telecommunication Regulatory Commission (BTRC) is preparing to auction the 700 MHz spectrum, which was previously allocated free of charge to an ISP named Always On Network. As part of the move, the regulator has indicated that 25 MHz of spectrum may be offered to mobile operators in the current fiscal year. However, the operators have expressed serious concerns regarding the proposed base price. In response to investor objections, the government had earlier hinted at a conditional price reduction of up to 10 percent.
On 16 March, the principal foreign investors of Grameenphone, Robi, and Banglalink sent a letter to the Special Assistant to the Chief Adviser on Posts, Telecommunications and ICT Affairs, Fayez Ahmed Taiyyeb, expressing concern over spectrum pricing. In his reply, Taiyyeb stated that considering the relatively slow growth of devices supporting the 700 MHz band, “a 5 to 10 percent price reduction may be rationally considered,” contingent upon commitments from operators regarding infrastructure expansion, service quality improvement, and competitive pricing for consumers.
However, the letter did not appear to sufficiently reassure the operators. As a result, on 2 November, the country’s three leading mobile operators—Grameenphone, Robi Axiata, and Banglalink—jointly submitted a fresh letter to the BTRC Chairman, reiterating their concerns regarding the current auction design and pricing model. The letter was signed by Grameenphone’s Chief Corporate Affairs Officer Tanvir Mohammad, Robi’s Chief Corporate and Regulatory Officer Shahed Alam, and Banglalink’s Chief Corporate and Regulatory Affairs Officer Taimur Rahman.
According to the operators, the 700 MHz band is globally recognized as a “coverage spectrum” crucial for expanding connectivity in rural and underserved regions. While the National Spectrum Roadmap (2024) allocates 2×45 MHz in this band, the current auction plan proposes to release only 2×25 MHz, which operators argue would artificially restrict supply and drive up prices.
They further stated that the pricing of the 700 MHz band has been equated to that of the 900 and 1800 MHz bands, despite the markedly different commercial dynamics. Nearly all mobile handsets currently in use support 900 and 1800 MHz, whereas only about 35 percent of devices support the 700 MHz band. This significantly lowers the potential for revenue recovery on investments in the 700 MHz spectrum.
As per the proposed structure, the price of each MHz in the 700 MHz band is set at Tk 284 crore including VAT. Operators contend that even after a hypothetical 10 percent discount, the pricing remains commercially unjustifiable. Citing GSMA research, they noted that low-frequency bands like 700 MHz are primarily used to expand coverage rather than to directly drive revenue growth, and that globally, the average price of sub-1 GHz spectrum has dropped by about 75 percent over the past decade.
The operators also pointed out that deploying the 700 MHz spectrum would require substantial additional investment in new radio equipment, antennas, software, hardware, and power systems. Tower upgrades would incur additional lease payments to tower companies, increasing operating expenses for mobile operators.
Industry representatives stated that revenue growth in Bangladesh’s telecom sector has been slowing for several years, making it increasingly difficult to justify new investments to stakeholders. They argued that participating in the auction at the current price level would be financially risky and commercially irrational. The operators urged the government and BTRC to adopt a pricing framework that supports sustainable investment and enables nationwide quality connectivity expansion.
According to the three operators, the sector is already under strain due to spectrum-related costs, limited revenue expansion, and the high expenses associated with technology upgrades. In such circumstances, balancing government revenue objectives with investment viability has become a significant challenge.
Industry sources warn that without a reasonable and viable price adjustment, operators may collectively decide not to participate in the auction. If such a situation arises, the 700 MHz band risks remaining unused and commercially nonviable.
It is noteworthy that on 24 May, the BTRC cancelled the allocation of the 700 MHz spectrum previously granted to Always On Network Bangladesh Ltd.
DBTech/IH/OR
