First SMP restrictions come into effect after nine years

Today will be the first time a restriction will come into effect on Grameenphone since the Bangladesh Telecommunication Regulatory Commission (BTRC) started working on Significant Market Power (SMP) guidelines nine years back to enhance competition and bring balance to the market.

A mobile network operator can be labelled an SMP, thereby paving the way for restrictions, if it controls more than 40 per cent share of any parameter, according to the guidelines.

Grameenphone holds 45.64 per cent share of the subscriber base and more than 50 per cent revenue share.

Declaring the dominant operator as an SMP is a common practice in the developed world and such regulations are also in place in India, Thailand, Singapore and Malaysia.

The BTRC first started the process to enact the SMP guidelines in 2011. It was finalised in 2018.

The commission declared Grameenphone an SMP operator in February last year and came up with four restrictions twice. But Grameenphone managed to put those on halt challenging the processesat the High Court.

However, on December 15 last year, the High Court cleared the way for the telecom regulator to bring the SMP guidelines into effect.

The BTRC has recently issued three directives under the SMP guidelines, two of which comes into effect today and the remaining one from July 16.

From today, Grameenphone will have to secure prior approval from the BTRC before rolling out any packages or offers, according to a directive issued on June 21. Existing packages and offers will have to be validated by August 31.

The carrier would not be able to change or amend any of the conditions of approved packages or offers without consent from the commission.

The second guideline coming into effect from today makes it easier for subscribers to leave Grameenphone under the mobile number portability (MNP) facility.

Currently, if a user wants to switch to another network, they will have to stay with the new carrier for at least 90 days. But subscribers can now abandon Grameenphone after just 60 days.

The third directive, issued on Sunday, says that from July 16, Grameenphone will have to pay 3 paisa more to non-SMP operators for per minute calls its subscribers make to another network.

At present, the interconnection cost is 10 paisa a minute for everyone.

The regulator has stipulated that Grameenphone will continue to pay 10 paisa to a carrier if a Grameenphone customer makes a call to that carrier.

Meanwhile, the country's remaining three carriers in their turn will have to pay 3 paisa less, or 7 paisa a minute, to Grameenphone, according to the letter.

The initial restrictions had four tough conditions and the BTRC is still considering increasing the per-minute call charge for Grameenphone but considering the ongoing Covid-19 pandemic, the regulator has chosen to go soft, said a BTRC top brass.

The BTRC earlier decided to fix the minimum floor price on call charge at Grameenphone at Tk 0.50 per minute, which is currently Tk 0.45 for all operators.

Under the Covid-19 outbreak, the telecom regulator has no intention to create any challenge to the customers and that is why the regulator halted it, said a senior official of the system and services division who is related to the process.

"We have done several studies with the data that operators provided us and went through to come to a conclusion that this regulation will help enhance the market competition," said the official requesting not to be named.

The leading carrier is still on the path of a legal process and filed a writ petition on Sunday while also trying to reach consensus through a dialogue with the BTRC.

The SMP guidelines should have been formulated long ago, Md Jahurul Haque, chairman of the commission, told The Daily Star yesterday.

"We are trying to enhance the market competition and hope that after completion of the process, market equilibrium will be in place," he said.

He said Grameenphone has no way other than complying with the directives. From early today Grameenphone is supposed to abide by at least two restrictions, said Haque.

"We are willing to sit with GP, which we did over the times, but for this issue before sitting they will have to withdraw the writ petition first," Haque said firmly.

"The GP CEO talked with me this (yesterday) evening and said they will comply with the directives and will withdraw the writ. And if they do it, we are willing to move for a dialogue. But the directive implementation needs to be ensured first."

Grameenphone in a press release yesterday stated that it was implementing the two SMP directives related to the MNP and approval of products and services "under protest".

"However, the company remains hopeful that the prevailing gap in understanding between GP and the BTRC can be resolved through constructive and meaningful dialogue."

"As part of the process, Grameenphone intends to withdraw the writ petition that was filed on June 28, 2020," it said.

Three other carriers – Robi, Banglalink and Teletalk – are more or less satisfied with the regulator's toughness but say that the processes they were enacting might be very complex.

The number of active subscribers at Grameenphone stood at 7.65 crore, earning the carrier Tk 14,366 crore in 2019. It logged a record Tk 3,452 crore profit last year, the highest to date.

Robi controls 29.98 per cent of the total subscriber base followed by Banglalink at 21.41 per cent and Teletalk at 2.97 per cent.