Government cuts licence and licence conversion fees, but price per MHz of spectrum to be auctioned is higher than operators had hoped

Bangladesh will hold an auction of spectrum suitable for 4G services by the end of this year, according to a local press report, but it appears that prices will be higher than the operator community had hoped.

The government on Tuesday gave the go-ahead to the Bangladesh Telecommunication Regulatory Commission (BTRC) to push ahead with the spectrum sale, the Daily Star said.

The country plans to sell of frequencies in the 900 MHz, 1800 MHz and 2.1 GHz bands.

The government has set a minimum price of US$30 million (€25 million) per MHz for the 900 MHz and 1800 MHz bands, while the 2.1 GHz band will start at $27 million per MHz.

According to the paper, operators had lobbied for a starting price of $15 million per MHz in all three bands.

The country’s telcos will have other fees to pay on top of the cost of the spectrum.

The cost of a 4G licence is 100 million Bangladeshi taka ($1.2 million/€1 million), down from an earlier proposal from the BTRC of BDT150 million, while the regulator has cut the annual licence fee to BDT50 million from BDT75 million.

In addition, operators will pay BDT1.5 billion to participate in each band of the spectrum auction.

The paper also noted that telcos face extra charges to convert their existing licences in the 900 MHz and 1800 MHz bands to technology-neutral permits. The state has set the conversion cost at $7.5 million per MHz, down from an earlier proposal of $10 million.

Mobile market leader Grameenphone uses 14.6 MHz of frequencies in the 1800 MHz band and 7.4 MHz at 900 MHz, while Robi Axiata has 26.4 MHz of spectrum across the two bands, the Daily Star said. Bangalink has 15 MHz and state-owned Teletalk 15.2 MHz.

The BTRC expects mobile operators to roll out 4G services as soon as they receive their licences. They have three years to cover the whole country with 4G.