ITC (International Terrestrial Cable) operator Fiber@Home Global has expressed interest in exporting state bandwidth jointly with Bangladesh Submarine Cables PLC, the only operational submarine cable licensee in Bangladesh. In December last year in view of the proposal to Fiber@Home ITC, BSCPLC decided to phase-sell about one terabyte of bandwidth at an additional 10% reduced price from their proposed IIG tariff. BSCCL’s current Acting Managing Director Mirza Kamal Ahmed, in that meeting, agreed to give this opportunity at a discount of 35%. However, it was not confirmed whether the regulatory body Bangladesh Telecommunication Regulatory Commission has approved it or not.
However, when this decision was leaked, other telecom companies including IIG (International Internet Gateway) objected to the proposal of Fiber@Home Global citing violation of policy. They alleged that Fiber@Home Global has both ITC and IIG licenses. According to the policy, they can buy bandwidth from submarine cables as IIGs; But there is no opportunity to buy as ITC. Again, they have the opportunity to serve the country by bringing bandwidth from India as ITC, but they do not have the opportunity to export bandwidth.
In this regard, IIG Association of Bangladesh (IIGAB) Secretary General Ahmed Junayed said that this decision will pose a great threat to the government’s revenue and national security.
According to him, if the ITC company provides one terabyte i.e., 1000 GB of bandwidth to Fiber@Home Global at an additional 10% lower price, the company will offer these bandwidths to other IIGs at a lower price. Almost all IIGs except some IIGs will shift to a bundle package with ITC. The submarine cable company will lose its direct customers. As a result, the revenue of BSCCL will be threatened. Also, Fiber@Home is getting bandwidth from its own ITC instead of IIG submarine cable, becoming the same company. In that case, it does not have to pay VAT. So, they are getting 10 percent discount. Along with that, the company does not have to pay advance income tax and also does not have to pay VAT as well. That is, at the end of the day, the government is not getting 15 percent revenue directly here. Similarly, if Fiber@Home is connected with submarine cable to take bandwidth as ITC, India’s overseas operator will also get connectivity. In that case, they will try to enter India’s bandwidth through one border of Bangladesh and take it out through the other border. Then it will become like a transit. Which is in violation of ITC, Submarine Cable and ILDTS Policy 2010. Moreover, it is not possible to take any kind of visibility of what kind of information or data is going from India to Singapore or coming from Singapore through Bangladesh using Bangladesh as a transit, which is a threat to the overall national security. Above all, if Fiber@Home has a bilateral service exchange or inter-island service exchange with its overseas operator located in India or with an operator in Singapore, then the country will be deprived of foreign remittance. Bilateral service exchange means, for example, that ITC sold 300 GB of capacity to its Singapore operator and in exchange received another service of equal value without receiving foreign exchange. Similarly provided 300 GB service to an overseas operator in India and instead took another service of equivalent value without taking foreign currency. As a result, the Bangladesh government was deprived of earning this 300 GB’s foreign currency.
However, BSCPLC managing director Mirza Kamal Ahmed has not been able to comment on these arguments, but he told the media that after getting permission from the regulatory body, Fiber@Home Global must also take permission from BSCCL. A rate will then be determined. It may be equal to the existing IIG rate, or we may give a discount. But they will be done in accordance with the law.’
In such a situation, market analysts believe that currently BSCCL provides around 3000 Gbps bandwidth services to various IIG companies. Through this, the company is earning about Tk 45 crores of revenue per month. But when BSCPLC, an ITC company will provide one terabyte i.e., 1000GB of bandwidth to Fiber@Home Global at an additional 10% lower price, Fiber@Home will be able to offer services to IIGs at a much lower price due to the slab of one terabyte. Many IIG companies will then migrate to Fiber@Home in an attempt to reach India and Singapore via Fiber@Home at a lower cost. Among them, the incident of BSCPLC unprofessionally capping the bandwidth of 19 IIGs from 12 midnight on the eve of the holiday without any notification in last November has adversely affected other IIGs. As a result, many IIGs have already shifted their capacity from BSCCL to ITC after that incident. In the meantime, if one more terabyte of bandwidth is given from BSCPLC to Fiber@Home Global, then more IIGs will be transferred to Fiber@Home Global, thereby threatening BSCPLC’s revenue. As a result, BSCCL’s approximately 1600 GPS bandwidth is reduced and there is a risk of revenue loss of about Tk 27 crore per month.
According to experts, as per ILDTS Policy 2010, submarine cable and ITC are licensed at the same layer. Just as one IIG cannot provide services to another IIG as a license of the same layer, as one ISP cannot provide services to another ISP, it is not understandable how Submarine Cable can provide services to ITC or how ITC can be a reseller of Submarine Cable. According to industry insiders, while the joint venture appears to be generating additional revenue of Tk 10 crore through the sale of 1000 GB bandwidth by BSCPLC to Fiber@Home, in fact Tk 27 crore of revenue is going away from the IIGs. As a result, the total loss is about Tk 17 crore per month. Not only that, the government will also losing a huge amount of revenue in this regard. ITC shares 1% of their revenue while BSCPLC shares 3% revenue. In this case, when the customers and capacity of BSCPLC will go to ITC, then the revenue that the government would get from BSCPLC at the rate of 3% on 27 crores per month will get over 10 crores. As a result, the revenue will decrease significantly. On the other hand, Fiber@Home Global has its own IIG. This IIG will be able to avail services from ITC owned by its own company at a lower cost than other IIGs. As a result, a monopoly in the industry will be attempted. Eventually, the rest of the IIG companies will be under threat.
Notably, there are total 7 ITCs in the country including the state-owned Bangladesh Submarine Cables. The remaining six private ITCs are – BD Link Communication Limited, Fiber@Home Global Limited, Mango Teleservices Limited, Novocom Limited, One Asia Alliance Communication Limited and Summit Communication Limited.