Bangladesh’s mobile industry is at a crossroads as operators face rising spectrum costs and heavy taxation that threaten network investment and 5G readiness, according to GSMA Intelligence.
Spectrum auctions in Bangladesh
BTRC (Bangladesh Telecommunication Regulatory Commission), recently auctioned 190 MHz of spectrum in the 2.3 GHz and 2.6 GHz bands for 15 years. The auction fetched about Tk 10,645 crore (~US$135 million). After these allocations, Grameenphone’s spectrum holding rose to ~107.40 MHz, Robi to ~104 MHz, Banglalink to ~80 MHz, and Teletalk to ~55.20 MHz.
Grameenphone and Robi also secured additional 20 MHz each in the 2.6 GHz band under separate agreements.
The BTRC has signaled intention to auction spectrum in the 700 MHz band during the current year to support both 4G coverage expansion and 5G deployment. There have been proposals for conditional concessions on pricing for 700 MHz spectrum to ease concerns from network operators and investors. Also, some international operators flagged concerns about auction timing and parameters for the 700 MHz band.
Requests from operators to acquire spectrum in other bands (e.g. the 850 MHz band) have been rejected by the regulator — Grameenphone had sought access to 850 MHz but was denied citing opposition from competitors and technical concerns over interference and service quality.
Another recent move is starting installment payments by operators for spectrum acquired: for example, Grameenphone and Robi started paying installments for their additional 20 MHz in the 2.6 GHz band.
The GSMA study released today highlighted that Bangladesh’s high spectrum and tax costs are posing threats to digital growth and warned that lowering spectrum prices could unlock up to US$45 billion in economic growth by 2035.
Here are insights telecom operators and stakeholders should note:
# Limited Spectrum Holdings
Bangladesh’s operators collectively use just over 500 MHz of spectrum, far below most Asia-Pacific markets, despite recent additions in the 2.3 GHz and 2.6 GHz bands.
# High Spectrum Cost-to-Revenue Ratio
The spectrum-cost-to-revenue ratio reached 15.7 percent in 2023, up from 11 percent in 2014. This is twice the global median of 7.7 percent and well above the Asia-Pacific median of 10.4 percent.
# Crucial Upcoming Renewals
Immediate priorities include renewals in 900 MHz, 1.8 GHz and 2.1 GHz bands and new assignments in 700 MHz and 3.5 GHz to support 4G expansion and future 5G deployments.
# Escalating Aggregate Spectrum Costs
Costs have risen due to currency depreciation, high reserve prices, and US-dollar-denominated licence fees, making Bangladesh one of the costliest markets globally for mobile spectrum.
# Declining Revenue Per Connection
From 2014 to 2023, inflation-adjusted revenue per mobile connection fell 38 percent, shrinking operators’ capacity to absorb higher spectrum costs.
# Falling Commercial Value of Spectrum
Despite greater holdings, revenue per MHz dropped 69 percent, signaling that spectrum prices must adjust downward to reflect current market realities.
# Heavy Tax and Fee Burden
Operators face a 22.2 percent sector-specific tax on revenue (5.5 percent BTRC revenue share + 1 percent Universal Service Fund + licence fees). Including consumer taxes, the total tax load hits 55 percent of operator revenue, versus a 22 percent global average.
# Risk of Investment Slowdown
High spectrum and tax costs deter network upgrades and could delay nationwide 5G, limiting digital economy growth and job creation.
# Economic Gains from Lower Spectrum Pricing
International evidence shows that reducing spectrum costs boosts network quality, expands broadband coverage, and can add billions of dollars to GDP through better connectivity.
# Need for Transparent Auction Practices
High reserve prices have left spectrum unsold and encouraged a “winner’s curse,” where operators overpay and struggle to invest in deployment. Competitive, market-based auctions can help set realistic prices and reduce risk.
Bottom Line for Telecom Operators
To unlock the full potential of Bangladesh’s digital economy, regulators and industry stakeholders must align spectrum pricing with market fundamentals, ease tax burdens, and ensure efficient allocation. Lowering spectrum costs will encourage 5G rollout, improve mobile broadband, and drive long-term revenue growth for operators, GSM said.
Baburajan Kizhakedath