Bangladesh Submarine Cable Company (BSCPLC) is making a bold move to sell bandwidth to International Terrestrial Cable (ITC) operators, potentially allowing private company Fiber at Home Global Limited to export government bandwidth. Despite the absence of specific regulations governing this, concerns have been raised about potential revenue losses for the government.
In the realm of internet connectivity between Bangladesh and other countries, submarine cable and ITC operators play a crucial role. The country's 34 International Internet Gateways (IIGs) rely on these operators to purchase bandwidth at wholesale rates. Subsequently, this bandwidth is distributed to the public through Internet Service Providers (ISPs). Presently, BSCPLC caters to 2000 Gbps out of a 5000 Gbps demand.
Meanwhile, six ITC operators import 3000 Gbps from India. The capacity of Bangladesh's inaugural submarine cable, 'C-Me-We-Four,' has surged to 7200 Gbps. In a bold move, Fiber at Home Global Limited, operating as an ITC company, has expressed interest in purchasing one tera (one thousand Gbps) bandwidth at a discounted rate of 25 to 35 percent. The company has formally communicated this proposal to Submarine Cable Limited PLC. In addition to this joint venture, Fiber at Home Global Limited seeks to export bandwidth to India.
Conversely, the Submarine Cable Company has indicated a willingness to provide a maximum discount of 10 percent, contingent on board approval. Telecom-related organizations have raised concerns, labeling the company's proposal as a violation of policy. However, stakeholders argue that ITC companies can acquire bandwidth from the country with approval from the Telecommunication Regulatory Commission (BTRC).
In response to inquiries, Mirza Kamal Ahmed, Acting Managing Director of the Submarine Cable Company, informed Bangla Tribune, "Fiber at Home Global Limited has expressed interest in purchasing one tera bandwidth under the ITC license through a letter. However, no decision has been reached yet. If approved, others can also obtain ITC; it cannot be limited to just one entity. If granted, approval will be extended to all."
Addressing the absence of specific regulations for ITC companies to procure bandwidth from their own country, Ahmed stated, "There is no established rule mandating ITC companies to buy bandwidth domestically. However, they can do so with approval from the BTRC (Telecommunication Regulatory Commission). All procedures will adhere to existing rules."
In light of this situation, Bangladesh Submarine Cable PLC established a committee to evaluate the reduction in IP transit prices and Fiber at Home Global Limited's proposal to purchase bulk bandwidth. The committee convened on December 21 and subsequently submitted a report. Notably, the report highlighted that Fiber at Home Global owes the Submarine Cable Company Tk 23 crore 64 lakh 68 thousand 224 (as of November 30, 2023). The report emphasizes that all outstanding dues must be settled before proceeding with the sale of bandwidth. Fiber at Home Global's security deposit is recorded at Tk 3 crore 59 lakhs.
Fiber at Home Global holds licenses for both ITC and IIG. According to the prevailing policy, they can procure bandwidth from submarine cables as IIGs. However, there is currently no provision for obtaining bandwidth as ITC within the country. The opportunity to serve the nation by importing bandwidth as ITC from India is available, but there is no provision for exporting bandwidth.
As per reliable sources, current International Internet Gateway (IIG) operators are expending between Tk 135 to Tk 168 per Mbps to procure bulk bandwidth ranging from 100 to 1000 Gbps. Conversely, acquiring 1000 Gbps with a 10 percent discount would result in a lower cost per Mbps for Fiber at Home Global. For business reasons, this discounted bandwidth could be sold to other IIGs at a price below the current market rate, potentially causing imbalanced competition in the market and sector.
When queried about the situation, Chief Operating Officer of Fiber at Home Global Limited, Moshiur Rahman, stated, "We have not received any decision from BSCPLC yet. The matter is at an early stage." Rahman expressed the company's desire to become an associate or partner of BSCPLC in terms of bandwidth export, highlighting that BSCPLC was the first BTCL partner in bandwidth export. Fiber at Home Global Limited seeks to establish a similar partnership.
In response, IIG Forum Secretary General Ahmed Junayed conveyed to Bangla Tribune, "With the exception of a few IIGs, the rest will transition to a bundle package with ITC. This shift has financial implications, as ITC accounts for 1 percent of revenue, submarine cable for 3 percent, and IIG operators share 10 percent of revenue (revenue share) with BTRC. Operating as ITC instead of IIG, Fiber at Home Global will share one percent of the revenue, resulting in a loss for the government."
Junayed emphasized that if ITC purchases bandwidth, they are exempt from VAT, translating to a 10 percent discount. This implies a direct cost saving of 15 percent, as there is no Advance Income Tax (AIT) and no VAT.
Concerns have been raised about the connectivity of overseas operators in India if Fiber at Home establishes connectivity with submarine cables to procure bandwidth as ITC. Some stakeholders believe that India may exploit Bangladesh as a transit, presenting a potential security risk.