BSCCL to take submarine cable systems and services licence

Bangladesh Submarine Cable Company Limited (BSCCL), a core submarine cable internet bandwidth provider in the country, has got approval from its board of directors to apply for a submarine cable systems and services licence.

Officials at the Bangladesh Telecommunication Regulatory Commission (BTRC) said, at present, the BSCCL operates two submarine cables on special permission from the Ministry of Post and Telecommunication. The commission asked the government-owned company to submit an application for a licence under the new guideline, they added.

To operate submarine cable-based internet business, the BTRC formulated the guideline on issuing licence in 2011, the BTRC officials mentioned, adding that the commission, however, did not provide any licence to build, operate, and maintain submarine cable systems and services in the country till date due to some problems.

The BTRC originally made the guideline for issuing only two licences, but it amended the guideline this year to facilitate the private sector to do this business. After issuing a licence to the BSCCL, the commission will give private investors an opportunity to apply within the next year, officials said.

To obtain the licence, the BSCCL needs to deposit Tk11.50 crore in licence acquisition fee to the Bangladesh Telecommunication Regulatory Commission (BTRC). The company also needs to pay Tk3 crore in advance as annual license fee. After getting the licence, the BSCCL will have to pay 3% of its total gross revenue to the BTRC.

Mashiur Rahman, managing director of the BSCCL, told The Business Standard, "At present, we have to share 10% revenue with the BTRC. After getting the licence the share amount will be 13%," he added.

He, however, said they will not require sharing revenue with the BTRC for the first year's operation under the licence.

In the 2020-21 fiscal year, BSCCL's revenue rose by 40% to Tk344.85 crore and its net profit jumped 111% to Tk190.73 crore when compared to the previous year as Internet use increased significantly across the country.

 Because of the Covid-19 situation, more and more activities are now conducted online using Internet bandwidth, which has contributed to the increase in demand for services provided by the BSCCL, observed Mashiur Rahman.

At the end of the last fiscal year, BSCCL's earnings per share (EPS) stood at Tk11.57, which was Tk5.49 a year ago.

The company declared a 37% cash dividend for its shareholders for FY21, which is highest since its listing with the stock exchanges.

In the past one year, its share price rose 89% to Tk236, which closed at Tk212.50 on Thursday at the Dhaka Stock Exchange.

The BSCCL operates two submarine cable landing stations with the capacity of 1,900 gigabits per second. The first is SMW-4 in Cox's Bazar launched in 2005 and the second is SMW-5 in Kuakata that started operations in 2017.

The company is set to build the third submarine cable at a cost of Tk692 crore. The completion of the project is expected to increase bandwidth by an additional six terabits per second, increasing the scope for earning foreign currency. The project is scheduled to be completed by 2025.

Since the beginning of 2017, the market share of the BSCCL began to increase significantly that currently stands at about 74%.

At present, Bangladesh consumes 1,564 Gbps of bandwidth from the BSCCL and 95% of it comes through the Singapore route.

According to BTRC data, the number of Internet users was 12.54 crore in August this year, while mobile Internet subscribers were 11.54 crore and broadband users 1 crore.