Mobile, the game changer for Bangladesh
From education to entertainment, transacting money to earning foreign remittance, paying bills to distributing relief -- it's all about the help of mobile links.
There was a very popular TV commercial, about one-and-a-half decades ago, where one stockbroker was making a lowball offer to a sea-returned fisherman, who was already informed about the market price through his mobile phone. The fisherman replied: "Days are not the same. It's already changed a lot!"
That was not only a commercial for a specific mobile carrier, rather it portrayed how the overall mobile telecommunication industry has evolved Bangladesh's overall socioeconomic activity and revamped it. And nowadays it's very tough to find a segment or service where there is no influence of mobile carriers' networks.
From education to entertainment, transacting money to earning foreign remittance, paying bills to distributing relief -- it's all about the help of mobile links. Starting a quarter of a century ago with voice calls and text messages, mobile telephone service is now offering enabled digital inclusion, which became the lifeline during the Covid-19 pandemic and also helped to spin the country's overall economic wheel faster.
Terming this development a paradigm shift, Mehboob Chowdhury, the first director of sales and marketing at Grameenphone, said mobile operators had to face different challenges in the last two-and-half decades, however, the carriers jointly contributed beyond early day assumptions.
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"Mobile carriers could have contributed even more if the regulatory regime was favourable over the years," said Chowdhury, former president of the Association of Mobile Telecom Operators of Bangladesh (AMTOB).
Chowdhury, who also played a role for the industry as a top brass of Banglalink and later become the long serving chief executive officer of Citycell, said, they first experienced GPRS (General Packet Radio Service) -- a packet-oriented mobile data standard on 2G cellular communication network -- for internet in 2001 and thought mobile technology would change the economical dynamics.
"Achievement was much bigger than the supposition. We should cheer for the silver jubilee of the country's GSM (Global System for Mobile) telecom service."
The mobile telecom industry has already passed three decades, counting Citycell as one of the first carrier in this region awarded a licence in 1989, but in real words when top three carriers -- Grameenphone, Robi (then AKTel) and Banglalink (Sheba) -- entered into the service scene in 1997, true entrances happened. All these three were awarded licences on November 11, 1996 but Grameenphone was the first mover.
On March 26, 1997, Grameenphone started its commercial operation and moved into its silver jubilee having 8.35 crore active users as of 2021, which means they have activated about 10,000 connections a day on average, while the industry as whole activated about 20,000 connections per day.
During its voyage, Grameenphone not only secured top position in Bangladesh, it also became one of the most successful mobile telephone ventures of Telenor, a leading global telecom business group. The remaining two carriers also launched their services in the latter part of that year, jointly pushing forward the country to scale up its moderate growth. So Robi and Banglalink are also going to complete their successful first 25 years in the second part of this year.
According to a recent report of the GSMA, a global association of cellular carriers boasting more than 750 mobile operators, unique mobile users of the country is just about 90 million (9 crore) and internet penetration is about 25%. Meaning, mobile connectivity is yet to reach 50% and internet acerbity is far behind expectations, so the growth prospect is still higher in Bangladesh, reads the report titled "Achieving mobile-enabled digital inclusion in Bangladesh" published in March 2021.
However, despite the backlog the AMTOB has calculated that in 2020 the overall contribution to the gross domestic production (GDP) though mobile carriers was about 7%, more than three times higher compared to 2010.
Recently, the AMTOB shared this data with the National Board of Revenue saying that in 2020 all the mobile carriers jointly contributed Tk16,523 crore and cumulative contribution up to that year was more than TK 150,000 crore.
Mobile carriers have so far invested Tk140,000 crore till 2020 and generated about 8.5 lakh employment.
AMTOB members raised their voice about the tax issues and said that heavy tax barriers are the main bottleneck of the industry's growth.
Abu Saeed Khan, a senior policy fellow at LIRNEasia, said, "The mobile phone has evolved from personal novelty to a societal growth engine. But continuous enactment of anti-investment and anti-consumer regulations since 2007 has now degraded the mobile services to its worst state. Because Bangladesh is the only country in the world that forbids the mobile industry to deploy transmission infrastructure. Yet the authorities set service standards and foolishly aspire to launch advanced services like 5G."
Mobile becomes the backbone
In the last few years, the mobile network has become the main backbone of communication in the country. Though there are fibre-based broadband services, mobile networks reached the remotest part of the country. And all the communication, including business communications and transactions, shifted to the mobile network. Based on the mobile carriers, the mobile financial service (MSF) also grew fast in the country and currently more than 11 crore users are using such services.
Currently, 13 MFS providers are in the operation, having 56% of their accounts opened in rural areas-- an evidence of how the service has expanded financial inclusion among the people who were unbanked.
All kinds of digital service also shifted to this network which is helping reshape the country's economy and service sector.
The 'G' series
Though the country entered cellular service by 1992 (licence awarded 1989), the coverage was very limited and was available only in the two large cities. The lone operator then was providing cellular service using the CDMA (Code Division Multiple Access) technology. But the vibrancy came only when three others entered into the market in 1997 with GSM technology which was much more flexible for users and operators.
Currently, more than 98% of the population are covered with the fastest 4G mobile network. However, only 40% of the population is using 4G, while it is more than 53% in India and 44% in Pakistan, according to the GSMA intelligence and PTA report.
In 2012, the country entered the 3G era through the state-owned Teletalk and later on private operators launched the 3G mobile data service in 2013. In 2018, the country welcomed 4G service and that was the ultimate boom period for digital services in the country. It is seen that 4G accelerated the digital transformation of the country.
Though data service flourished in Bangladesh, Shahed Alam, chief corporate and regulatory officer at Robi, said, "Still Bangladesh is a voice-dominated market and that's why we can't harvest the potential growth both for the digitisation and country's overall socioeconomic growth. The 4G usage gap in Bangladesh is one of the highest in South Asia due to the lack of affordable 4G devices."
According to Alam, though there are 14 mobile handset assemblers in the country now, but 4G handset prices didn't come down to the level which would attract the most users.
And now the carriers are going to sit in a spectrum auction for 5G set on March 31. In every spectrum auction, the government is taking a huge amount of money and that has become a hindrance to carriers in offering affordable and quality service to its users.
Grameenphone ahead of others
Not only in connection numbers, Grameenphone is also leading from the front in terms of business also. The market leader secured Tk3,413 crore net profit last year which was almost one-fourth of their total revenue.
And in the last four years, their net profit rose to Tk14,096 crore just after launching 4G service in the country.
It was Grameenphone's target to reach one lakh customers by 2000, but they reached it within a few months.
"We had beat all our time assumptions against teaching the milestones -- even the first lakh, first million, first crore."
Mehboob Chowdhury said, "Grameenphone had invested a lot to expand its network which other carriers didn't match at that time and that's why they became the superior carrier."
Not only expanding the network, Grameenphone also invested heavily on digital services and other innovations, much more than its competitors and thus harvested the results from it.
Their Village Phone Programme was one of the massive introductions of empowering women using the communication tools, launched in the early days of its inception, which also helped them to cement their position in Bangladesh.
During his visit to Dhaka on 14 March, Jorgen C Arentz Rostrup, chairman of the GP board and the head of Telenor Asia (the parent company of GP), told the media that the mobile phone operator would be the first in investing in network when it comes to better customer services.
The telecom regulator is going to hold the next spectrum auction on 31 March for 5G and other technologies.
Rostrup said though 5G is still nascent in Asia, Telenor and Grameenphone are ready for it. Terming Grameenphone one of the most important companies in the Telenor portfolio, he said, "So, when we are celebrating 25 years here, it's really with pride and happiness."
