Internet prices to decrease at two levels

Multiple companies have announced reductions in internet prices at two stages of the supply chain, with the rates cut by 10 to 20 per cent.

However, questions remain over how much it will benefit the consumers.

According to operators, internet pricing depends on multiple factors, and it should not be expected that a reduction in bandwidth prices at two levels would directly lead to a decrease in prices at the consumer level.

The Bangladesh Submarine Cable PLC (BSCPLC), a state run entity, made the first announcement on price reduction as it declared to reduce prices of its all services by 10 per cent on 22 March.

Later, private internet service provider Fiber@Home also announced a price cut. Most recently, another private provider, Summit Communications, joined in with a similar announcement on 22 April.

Amid these developments, Faiz Ahmad Taiyeb, special assistant to the chief adviser on posts, telecommunications and information technology, said in a Facebook post on 21 April that an initiative has been taken to gradually lower internet prices at three to four levels.

He noted that there is no logical reason or excuse left for private mobile operators not to reduce their internet charges.

Meanwhile, the internet service providers association, ISPAB, announced on 19 April that it will now offer 10 Mbps internet for Tk 500, which is double of the previous speed of 5 Mbps for the same price. However, they did not announce any changes for the other packages.

While talking to Prothom Alo, ISPAB president Imdadul Haque said the Bangladesh Telecommunication Regulatory Commission (BTRC) must reduce its revenue sharing rate to ensure that the benefit of price reduction reaches the consumer level. Currently, the International Internet Gateways (IIGs) sells bandwidth to ISPs at Tk 200 per Mbps, but the BTRC receives a 10 per cent revenue share considering the price at Tk 365 per Mbps.

"If the price reduction applies to the current market rate (Tk 200 per Mbps), then customers will truly benefit," he said.

Asked about the issue, the head of communications at Grameenphone, Sharfuddin Ahmed Chowdhury, told Prothom Alo that internet prices are not dependent on any single factor, rather connected with various issues, including spectrum, tower, fiber, and electricity expenses.

"The final prices are determined based on the combined costs of these elements," he said, adding that Grameenphone is evaluating the developments considering the customers' interests.

The Grameenphone official also noted the issue of high taxation in the telecommunications sector, saying that both consumer and corporate taxes have long been unreasonably high in the telecommunication sector in Bangladesh.

Meanwhile, Shahed Alam, chief corporate and regulatory officer of Robi Axiata, welcomed the government's move to bring down internet prices.

He told Prothom Alo, “It will take some time to get the actual benefit of price reduction. If costs decrease over the course of time, internet prices will certainly come down.”